Disregarded people for CTR purposes

Can someone please clarify for me if I have interpreted this correctly?

Scenario:

Client and husband live in a 2 bedroomed property with the client’s mother, who is severally disabled. The tenancy is in the client’s name. Client is down as her official appointee as she is no longer able to manage her own affairs.

The mother receives her SRP as well as AA, but I am unsure at the moment as to whether there is PC Guaranteed in place.
The client receives CA with an IS top-up and more recently, she herself is now entitled to the ER of both components of PIP.

The local authority appear to have been using the mother’s SRP as income when calculating the client’s entitlement to CTR, so the award is minimal.

I believe that she should come under the disregard of ‘severely mentally impaired’ as if she is unable to manage her own affairs, then this should fit the criteria - or they could apply the disregard to the client as a Carer and disregard her income (may be that this avenue is less favourable though).

I’m having a doubting Wednesday moment…

Couple of points to help answer this:

- is your client (or husband) working age?
- if so, which local authority’s CTR scheme is it?

EDIT - removed first question as you have already answered it: client and husband are the tax payers, right?

Hi Anorak.

They come under the Kings Lynn & West Norfolk scheme

Edit: They are both of ‘working age’ but are not actual taxpayers.

I can’t find a full copy of their CTR scheme on their website, but there is a summary page about non-dependants here:

https://www.west-norfolk.gov.uk/info/20019/council_tax_support/29/council_tax_support_-_non-dependants

If the list of non-dependants who do not attract a deduction is complete on that page, they do not make an exception for non-dependants who are disregarded for the purpose of discount - they would need to fall into one of the other categories.  Pension Credit is the most obvious, but you say she might not be on Pension Credit.  But even then, the deduction should only be £3.77 a week for a non-dep who doesn’t work.  If they have reduced your client’s CTR by more than £3.77 a week on account of the mother’s income, there is something very wrong indeed.

The mother’s income certainly should not be used in any other way - she is not a CT payer herself because she is a non-dependant in someone else’s home and the principal CTR calculation should only look at the income of the client and her husband.

EDIT: Actually, scrub all that.  You said your client is on PIP(dl).  So there should be no non-dep deduction any way you slice it.  The client’s mother should not affect the CTR assessment at all.

Thanks for the link. PIP is a very recent award (under special rules) and I would like to try and get the Council to acknowledge that their calculations may have been wrong via another route.

I see that they state that there will be no deduction for an underlying entitlement to CA and for SG ESA, but no mention of Income support - slightly odd there?

A further question if I may.. Legislation states that people who are severely impaired should be disregarded, is this not the case in the mother if the client is her appointee, or is the Council able to override this?

Thanks for your help A

We are talking about CTR - the means-tested rebate - aren’t we?  Or are you concerned about liability to pay tax at all, irrespective of income?

Starting with liability, the fact that the mother is a disregarded person for discount has no effect on the initial CT liability here because they are not in line for a discount anyway.  There are two non-disregarded residents so they are liable for 100% council tax.  The tenant and her spouse should be jointly liable.  It doesn’t matter how many other people live with them, or whether those people are disregarded or not - they get a full CT bill to begin with.

But then, separately, there is CTR.  The treatment of non-dependants in a case where the council tax payer (CTR claimant) is working age is entirely up to the Council.  This Council operates a two-tier system of non-dependant deductions:

- £10 a week for each non-dependant in the case of non-protected claimants
- sliding scale from £3.77 a week for each non-dependant in the case of protected claimants

Your client is a protected claimant because she is on Carers Allowance, so the deduction for a non-working pensioner non-dep would be £3.77.  But now that your client is on PIP(dl) she shouldn’t even face that deduction: irrespective of whether the protected or non-protected scale of deductions would otherwise apply, there is no non-dep deduction at all if the CTR claimant is on PIP(dl).

Hi Anorak.

Yes it was to do with CTR and not the liability side of things.

Thank you for your answer, that has made it much clearer.