The Council Tax you pay makes vital contributions to services provided by your local authority, such as road maintenance, bin collections, street lighting, social care, public space maintenance, and many more. The average annual Council Tax bill in the UK is nearly £1,500. Even with the recent rebate designed to assist households with energy bills, Council Tax represents a sizeable sum that is a significant proportion of the household's income.
A complete Council Tax bill is based on at least two adults living in a household. However, certain people are exempt from paying Council Tax, which means some households may not need to pay it at all, while others can apply for a reduction in their bill.
The rules on whether students pay Council Tax differ depending on who else they live with and the amount of study time their course demands.
We are going to find out about students and Council Tax. When they are exempt, when they have to pay it, and what you should do if you want to apply for an exemption.
Households in which every resident is a full-time student are exempt from paying Council Tax. Households in which some residents are full-time students and others are working adults who are not exempt for any other reason usually have to pay Council Tax, though they may be eligible for a reduction.
There are other demographics and living situations that are eligible for Council Tax reductions or exemptions, which we will explore in greater detail later.
But let's first jump in and find out who counts as a full-time student.
To be considered a full-time student, you must fulfil the following criteria:
- you must be on a course that lasts at least one year
- your course must demand a minimum of 21 hours of studying per week - this does not necessarily mean all hours have to be contact hours; they can also be self-study.
You can be an undergraduate or postgraduate student or studying a course at a Further Education college.
If you are studying for a qualification up to level 3 (e.g. A-levels) and you are under 20, you must:
- be on a course that lasts a minimum of three months
- be required to study for a minimum of 12 hours per week
If you are a student studying for a Masters, PhD, or other post-graduate qualification, and your course lasts a year and demands at least 21 hours of study a week, you do not need to pay Council Tax.
Many post-graduate students choose to study their courses part-time while also working part-time. In this situation, you must pay Council Tax as you are not a full-time student.
If you are a student and you live in a house with other people who are neither full-time students nor from another demographic exempt from paying Council Tax, the household will receive a Council Tax bill.
However, the household may still qualify for a discount. It is between you and your housemates how the bill is split, as Council Tax is charged per household rather than individually.
If you are a student and have been paying Council Tax (perhaps you were unaware that you were exempt), you need to apply for an exemption with your local council. You may also be able to get a rebate for the money you paid, but you will need to contact your local council and speak directly to them to request it.
Many students don't work for the duration of their studies, while others do work, but often in low-paid jobs such as bartending or waiting tables. Whether they work or not, students are not entitled to benefits such as Housing Benefit or Universal Credit.
Therefore, to help ensure that students from lower-income families with no financial support have as much time for their studies as those from higher-income families, all students are exempt from paying Council Tax to help keep the costs of living to a minimum.
Full-time students are not the only group exempt from paying Council Tax. There are plenty of other people and property types that can apply for an exemption or a reduction.
So let's take a look at the other Council Tax exemptions. The following property types are all exempt from paying Council Tax:
- Unoccupied properties that a registered charity owns.
- Properties that are unoccupied because the person liable for paying Council Tax is in prison or detention.
- Properties that are unoccupied because the person liable for paying Council Tax lives in a hospital, care home, or assisted living.
- Properties that are unoccupied because the person liable for paying Council Tax is dead.
- Properties that are unoccupied because occupation is prohibited by law.
- Properties that are unoccupied and are being held for a religious minister of any denomination.
- Properties that are unoccupied because the person liable for paying Council Tax lives elsewhere to receive personal care. Their new sole residence must not be in an NHS hospital, care home, nursing home, or hostel.
- Properties that are unoccupied because the person liable for paying Council Tax is living elsewhere to provide personal care to another person.
- Properties under the possession of a mortgage lender.
- Student halls of residence.
- Properties used as accommodation by the UK armed forces.
- Properties used as accommodation by visiting armed forces.
- Properties in which the person liable to pay Council Tax has declared bankruptcy.
- Unoccupied spaces that are used for caravan pitches or boat moorings.
- Properties that are occupied solely by residents under the age of 18.
- Unoccupied annexes.
- Properties that are occupied solely by people with severe mental impairments.
- Properties that are used as the main residence of a person with diplomatic privilege or immunity.
- Annexes occupied by a dependent relative.
As we have seen, students are exempt from paying Council Tax. However, if you have to pay Council Tax but live with students, you may be eligible for a Council Tax reduction if there are no other working adults in the house.
You may also be able to claim a reduction if you:
- have no income or a low income
- are disabled
- live alone
As well as being based on the property size and value, Council Tax is partially worked out by the number of people that live in a property. Some people are not included when working out how many people occupy a property. This is called being 'disregarded.'
If you live in a property with disregarded inhabitants or if you are disregarded yourself, you may be able to apply for a Council Tax reduction.
Those who are disregarded include people who are:
- under 18 year olds
- undertaking certain apprenticeships
- aged 18 or 19 and are in full-time education
- full-time students at college or university
- under 25-year-olds who are in receipt of funding from the Education and Skills Funding Agency
- student nurses
- foreign language assistants who are registered with the British Council
- severely mentally impaired
- live-in carers who aren't partners or spouses to the individual they care for
If you think your household would qualify to claim Council Tax exemption or a reduction, you can apply for one either by contacting your local council or by applying online.
If you successfully apply for an exemption or a reduction and your circumstances change, you must inform your local council immediately. For example, you may be a student and leave your course prematurely and start working. Or you may work and have students living in your house who leave and are replaced by non-students.
In all instances, you must tell your local council. Failure to do so could result in a fine.
Council Tax rates in England and Wales are based on the property's value on the open market on 1 April 1993 in England and 1 April 2003 in Wales.
The Council Tax bands in England are as follows:
|Band||Value on 1 April 1991|
|A||up to £40,000|
|B||£40,001 to £52,000|
|C||£52,001 to £68,000|
|D||£68,001 to £88,000|
|E||£88,001 to £120,000|
|F||£120,001 to £160,000|
|G||£160,001 to £320,000|
|H||more than £320,000|
The Council Tax bands in Wales are as follows:
|Band||Value on 1 April 2003|
|A||up to £44,000|
|B||£44,001 to £65,000|
|C||£65,001 to £91,000|
|D||£91,001 to £123,000|
|E||£123,001 to £162,000|
|F||£162,001 to £223,000|
|G||£223,001 to £324,000|
|H||£324,001 to £424,000|
|I||more than £424,000|
When a new property is built or an existing uninhabited property is converted for habitation, the property must be assigned a Council Tax band. To do this, you need to contact your local council, and they will provide the Valuation Office Agency (VOA) with the relevant information to enable them to allocate a band.
Households that are solely occupied by students are exempt from paying Council Tax. If you live in a house where some inhabitants are students and others are not, you may also be eligible to apply for a Council Tax reduction. Many other circumstances can make your household exempt from Council Tax or eligible for a reduction.
Council Tax often costs households thousands of pounds a year, so it is a good idea to find out if you can claim an exemption or a reduction to help with the cost of living.