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Forum Home  →  Discussion  →  Housing costs  →  Thread

Severe mental impairment and hierarchy of liability for council tax

Jacky Philipson
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Housing and Benefits worker Manchester Mental Health Assertive Outreach Team

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Total Posts: 48

Joined: 28 July 2015

My client has SMI exemption for council tax and just moved to a new tenancy with her son. She is the named tenancy holder. Manchester Council Tax Service have advised me that a 25% discount will be applied to the property but that she will be liable for the remaining 75%.

She has a difficult relationship with her son (dob: June 1997) who works very intermittently,  will not claim any benefits and depends financially for the most part on my client. She however for now wants him to remain living with her.

The Local Government Finance Act - 6(1) - (4)  states that if two or more people occupy the same household and are in the same position on the hierarchy of liability, they will be jointly and severally liable and if any of those people are disregarded then the remaining people/person will be jointly and severally liable/solely liable. Therefore although it doesn’t say specifically does it therefore follow that if as in my case, two people are in different positions on the hierarchy and one is disregarded then the higher person remains liable even if they are the disregarded person.

I see how the above could be argued i.e. the overall liability (once discounts in respect of individuals living there have been applied) is applicable to the property and liability for the property is decided by the hierarchy of liability. But it seems to make more sense (and be fairer) that liability should fall to the highest person on the hierarchy who is not disregarded.

Would be very grateful if someone could confirm if my client is liable and if so she can therefore presumably claim council tax support despite being exempt. The council tax service have advised that her son should claim CTS which would be tricky for the reasons given above but surely my client should be able to claim any benefits to which is entitled to reduce her council tax liability in the same way that any other council tax customer would be able to.

Manchester disregard carers living in the household - they do not have to be in receipt of carers allowance. The son could therefore put in writing to the Council Tax Unit to say he is the carer. This strategy is slightly risky since it would be a big stretch to describe the son as a carer of any sort really.

If my client is liable and can claim CTS with non dep deductions if appropriate , this would seem to be the best option but any thoughts on any other interpretations of the law and/or alternative options would be much appreciated.

HB Anorak
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Benefits consultant/trainer - hbanorak.co.uk, East London

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Yes, she should claim CTR because she is the liable person.

Section 6(3) and (4) says that she cannot be jointly liable with him and that he would be liable if they shared equal status in the hierarchy, but they don’t: she comes first.  Therefore:

- she is the liable person
- there is a discount applied to the amount for which she is liable because there is only one resident who is “visible” (the son)
- she is eligible for CTR on the residual amount, subject to whatever non-dep deduction would apply for her son.

I did consider whether Manchester had adopted a weird CTR scheme that allows people who are not resident to claim, but it hasn’t: the scheme adopts the classes of person eligible for CTR under the Default Scheme regs and those in turn must be liable as a resident.  That means that only the tenant and not her non-dependant son is eligible to claim CTR.

Jacky Philipson
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Housing and Benefits worker Manchester Mental Health Assertive Outreach Team

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Total Posts: 48

Joined: 28 July 2015

Hi again
Can you direct me to the part of the Default Scheme Regs which shows the classes of people eligible for CTR - just to settle my argument with the BU who are telling me my client cannot claim CTR because she is SMI.
Thanks very much

HB Anorak
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Benefits consultant/trainer - hbanorak.co.uk, East London

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This is from Manchester City Council’s CTR scheme:

Part B
Council Tax Support for people of working age
For a person to whom regulation 3 (b) of the Council Tax Reduction Schemes (Prescribed Requirements) (England) Regulations 2012 applies (a “person who is not a pensioner”), the classes of person entitled to Council Tax Support
under this scheme for any week are those prescribed in paragraphs 16 and 17 of the Schedule to the Council Tax Reductions Schemes (Default Scheme) (England) Regulations 2012 (Class D and Class E)
and the provisions of
• Parts 1 to 3 and schedules 7 and 8 of the Council Tax Reduction Schemes (Prescribed Requirements) (England) Regulations 2012,
• The Council Tax Reductions Schemes (Default Scheme) (England) Regulations 2012, and
• The Council Tax Reduction Schemes (Prescribed Requirements and Default Scheme)(England)(Amendment) Regulations 2012 shall apply

And here are Classes D and E defined in the Default Scheme:

16.  On any day class D consists of any person who is not a pensioner—
(a) who is for that day liable to pay council tax in respect of a dwelling of which he is a resident

17.  On any day class E consists of any person who is not a pensioner—
(a) who is for that day liable to pay council tax in respect of a dwelling of which he is a resident;

Your client - the SMI tenant - is the person who satisfies those requirements as she is both liable and resident.  The son may be resident but he isn’t liable because of the hierarchy.  So it must be the tenant who makes the CTR application.

If they are saying that she isn’t liable, well the temptation would be for her to say “fair enough, I won’t pay then! Bye!”  But this will probably sort itself out correctly in due course it is wise for her to have a CTR application lodged to protect her position.