Agenda item

This report reviews the responses to the public consultation of the Council’s Local Council Tax Support Scheme 2024/25 and makes recommendations regarding the proposed Scheme for 2024/25 which will be subject to approval by Council on 28^th January 2024.

Purpose of report

To review the responses to the public consultation of the Council’s Local Council Tax Support Scheme 2024/2025 and to make recommendations regarding the proposed Scheme for 2024/2025 which would be subject to approval by Council on 25 January 2024.

Decision

Cabinet recommended to Council:

1.    The introduction of the Local Council Tax Support Scheme for 2024/2025 based on the same overarching criteria as the existing scheme and including the following:

a.    Continuation of the War Pension and Armed Forces Compensation Disregard for Housing Benefit and Council Tax Support with effect from 1 April 2024 (as detailed in paragraph 3.4 of the report).

b.    The alignment of the value of the capital tariff limit and disregard for working age claimants to the pension age claimant values with effect from 1 April 2024 (as detailed in paragraph 3.5 of the report).

c.    The introduction of a second home premium of 100% with effect from 1 April 2025, following the required 12 months’ notice to those ratepayers impacted by this change (as detailed in paragraph 3.7 of the report).

Alternative options considered and rejected

The detailed options given were at Appendix 1 of the report.

Reasons for decision

Continuing with War Pension and Armed Forces Compensation Disregard for Housing Benefit and Council Tax Support from 1 April 2024 was a continuation of the existing scheme and was at no additional cost.

Capital tariff limit and capital disregard for working age claimants was to be aligned to pension age claimant values, effective from 1 April 2024. Currently, working age customers with capital over £6,000 had £1 of ‘’tariff income’’ added for every £250.00 of capital they had. This increased the income used within a Council Tax Support scheme assessment by £1 per week. It was proposed for this to be aligned to the same limits as pensioners – these being a capital tariff of £1 for every £500, and a disregard of £10,000.There would be an increased cost to implement this scheme of £2,323.

The introduction of a Second Home premium of 100% – effective from 1 April

2025 was a measure included in the Levelling Up & Regeneration Bill to give Councils the ability to charge a council tax premium of up to 100% for any property left empty for more than 72 days a year. This may encourage second homeowners to make these properties available for rent or residence.

The Bill received Royal Assent on 26 October 2023, and was incorporated within the Levelling-up and Regeneration Act 2023: Levelling-up and Regeneration Act 2023 Stages - Parliamentary Bills - UK Parliament.

The Council must give residents one year’s notice of the intention to charge the 100% premium; therefore, notice would need to be given prior to 1 April 2024.

The current discount of 10% was a total cost of £56,453. The 10% discount would be removed and an additional 100% charge would be applied.

There were currently 353 Council Tax properties which would attract a premium. Such premiums would increase Council tax annual liability by £631,915 per annum. If this was paid in full, South Kesteven’s share of this additional income would be £56,872 (9%).