An information guide on how this scheme works

What claims are included in the banded scheme?

You come under the banded scheme only if you are in receipt of Universal Credit.

If you or your partner do not receive Universal Credit, you will not be affected by the banded scheme.

Key Points

  • We only look at your earned income. All other income such as Universal Credit or Child Benefit is ignored. This means we do not need to know about any changes in your Universal Credit
  • We use your earned income figure from your Universal Credit claim. We receive up to date information direct from the DWP of your Universal Credit Award and this includes the amount of earned income that they have used. This means you do not need to provide the council with wage slips or proof of capital as we will get this information directly from the DWP.
  • Out of work cases are still part of the banded scheme. If you are out of work and in receipt of Universal Credit, your council tax support will be part of the banded scheme but your entitlement will not change. This is because the bands correspond with the current scheme awards for out of work cases. If you are not protected, you will need to pay 80% of the council tax as you do now and if you are protected, its 100% as it is now.
  • All other factors remain the same. Nothing else has changed. So if you have a grown up living in your property, the charges are the same. We have not changed who comes under the protected scheme and we will still base any CTS award on no higher than a Band D property for someone who is not protected.

Why are we introducing a Banded Council Tax Support Scheme?

Council Tax Support (CTS) is a locally designed and funded scheme that assists households on low incomes to pay their council tax. It replaced Council Tax benefit from April 2013.

The regulations for pensioners (those that have reached their state pension age) are prescribed by Central Government and are based on council tax benefit regulations. There are no such regulations for working age claimants and as such, it is up to each local authority to develop a scheme that is affordable and helps those on low income cover their council tax costs

Since 2013, Hertsmere has based its working age scheme on the old Council Tax Benefit regulations. This means that the award is calculated by comparing the income with the applicable amount (what the government says the claimant should be able to live on, taking into account all circumstances such as number of children and any disabilities)

This scheme is based on older regulations that work well with older benefits such as Jobseekers Allowance, Tax Credits or Income Support.

It is now more common for a claimant to be in receipt of Universal Credit which works differently to these older benefits. The authority has therefore decided to introduce a scheme more aligned to the Universal Credit system that simplifies the assessment calculation making awards easier to understand and council tax instalments easier to follow.

 

Who falls under the protected group?

The definition of vulnerable groups was originally agreed by the council in 2013 as follows:

  • A lone parent responsible for a child under five.
  • The applicant, partner or child is in receipt of Disability Living Allowance (DLA) or Personal Independence Payments (PIP) at any rate
  • The applicant or partner is in receipt of Employment Support Allowance including the support component.

For the purpose of the banded scheme, the definition of vulnerable will remain the same. Therefore, if you fit any of the above criteria you will be in the protected group.

 

Income Bands

Income bands for the Protected Group

Income Band

Earnings

Benefit Level

0

Out of work

100%

1

<£60.00

80%

2

£60.00   - £100

60%

3

£100.01 - £200

40%

4

£200.01   - £400

20%

5

>£400

0%

 

Income Bands for the Working Group

Income Band

Earnings

Benefit Level

0

Out of work

80%

1

<£60.00

80%

2

 £60.00 - £100

60%

3

£100.01 - £200

40%

4

£200.01 - £400

20%

5

>£400

0%

Example Calculations

Example One:

Claimant circumstances:  Lone parent with a child under 5 in Band E property with earnings of £230 a week. (Protected Group) living in the Elstree and Borehamwood Parish

Full Weekly Council Tax Liability: £2,240.19 per year but as the claimant lives alone, they will be entitled to a 25% single person discount. This means the yearly liability will be £1,680.14 or £32.22 per week

Eligible Weekly Council Tax Liability: £32.22

Income Band: 4

Council Tax Support Calculation: 20% of £32.22 = £6.44

Weekly Council Tax Support: £6.44

Example Two:

Claimant circumstances: Couple with no dependents in Band E property with earnings of £230 a week (Working Group) living in Bushey

Full Weekly Council Tax Liability: £2,196.47 per year or £42.12 per week

Eligible Liability (Restricted to Band D rate): £1,797.11 per year or £34.47 per week

Income Band: 4

Council Tax Support Calculation: 20% of £34.47 = £6.89

Weekly Council Tax Support: £6.89

Example Three:

Claimant Circumstances: Single, not working and in receipt of Personal Independent Payment (PIP). Band C property (Protected Group) living in Elstree and Borehamwood.

Full Weekly Council Tax Liability: £1,629.23 per year or £31.25 per week but as the claimant lives alone, they will be entitled to a 25% single person discount. This means the yearly liability will be £1,221.92 or £23.43 per week.

Eligible Weekly Council Tax Liability: £1,221.92 per year or £23.43 per week

Income Band: 0

Council Tax Support Calculation: 100% of £23.43 = £23.43

Weekly Council Tax Support: £23.43

Example Four:

Claimant Circumstances: Single, not working. Band D property (Working Group) living in Aldenham

Full Weekly Council Tax Liability: £1,698.96 per year but as the claimant lives alone, they will be entitled to a 25% single person discount. This means the yearly liability will be £1,274.22 or £24.44 per week.

 Non Dependent Deductions

If you have a non –dependent living in your property, the deductions will remain the same as the current CTS scheme. The non- dependent charges can be found in the tables below;

Non – Dependent charge if you are in the Protected Group:

Non Dependent Income

Deduction

Student

£0.00

In Receipt of Universal Credit and working less than 16 hours a week

£0.00

In receipt of Income Support, State Retirement Pension, Jobseekers   Allowance

£0.00

Not Working

£4.05

Gross income below 217.00

£4.05

Gross income between £217.00 and £376.99

£8.25

Gross income between £377.00    and £468.99

£10.35

Gross income of £469 +

£12.40

Non – Dependent charge if you are in the Working Group:

Non Dependent Income

Deduction

Student

£0.00

In Receipt of Universal Credit and working less than 16 hours a week

£0.00

In receipt of Income Support, State Retirement Pension, Jobseekers   Allowance

£0.00

Not Working

£8.10

Gross income below 217.00

£8.10

Gross income between £217.00 and £376.99

£16.50

Gross income between £377.00    and £468.99

£20.70

Gross income of £469 +

£24.80

 Council Tax Charges

 Please vist Council tax - charges for 2020/21 rates.