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CTR for SMI
I’m struggling with this and it’s only Monday. We have 2 claimants..
1. Claimant owns his house. Parents live with him and both work. Claimant is in receipt of ESA and can claim Council Tax support.
2. Claimant owns his house but has a SMI. Parents live with him and both work. Claimant is in receipt of ESA but cannot claim Council Tax support as is deemed to have no liability and therefore the parents are liable for council tax and pay in full less 25%.
Is this right?
I don’t think so ... there can be exempt dwellings, and people who get discounts, but there’s not really a class of people who can never be personally liable.
In case 2 the dwelling can not be exempt from liability, because it is not wholly occupied by residents who have SMI or are students. Therefore the highest person on the hierarchy should be billed, regardless of his SMI. He himself is invisible for discount purposes. However there are still two other visible resident adults, so he gets no 25% or 50% discount, unless one or both parents can qualify for a carers C Tax discount? (unlikely if working). The person with SMI is liable, but can claim CTR.
In both case 1 and case 2 there are likely to be non-dep deductions on CTR [edit: oops, no NDDs if the claimant is on the right disability benefit]
This is all assuming standard CTR rules, there might be local exceptions.
Similar previously:
https://www.rightsnet.org.uk/forums/viewthread/10821/
https://www.rightsnet.org.uk/forums/viewthread/2177/
Thanks Jon. That was my thoughts. They have stated that client 2 (SMI) is disregarded for CT purposes therefore cannot be made liable. What utter tosh. What if he lived in the dwelling alone? They have quoted Local Government Finance Act 1992 Schedule 1 and Discount Disregards Order 1992, paragraph 3. Both would disregard him for discount purposes but do not state he cannot be liable.
What Jon says is correct.
Is this a council where CTR and Council Tax billing are not handled by the same officers? Has the SMI owner been billed for council tax (as he should have been), but the benefits section is refusing to award CTR on the basis that he shouldn’t be liable (which is wrong)? If so, the lack of joined-up administration is really poor.
If a bill has been issued to the parents on the basis that they are liable, they need to dispute that through the council tax appeals system (a sort of MR stage, followed by a directly lodged appeal to the Valuation Tribunal) and in the meantime the owner needs to protect his position in order to avoid future time limit problems: if he has not made a formal application for CTR he should do so; if he has had an application rejected he should also dispute it through the VT route. The worst outcome (which is not uncommon) is that it takes the council months or even years to get the billing situation sorted out, by which time it is too late for CTR to be claimed/appealed by the liable person: a frequently seen variation of this scenario is where the landlord and tenant are in dispute about who should be liable (is it an HMO or not) and when the dust settles it turns out the tenant is liable ... but s/he has taken no steps to claim CTR in the meantime. Anyone who foresees a backdated CT liability being established at some point down the line and whose income supports CTR entitlement needs to submit a preemptive/protective CTR application a.s.a.p.
What Jon says is correct.
Is this a council where CTR and Council Tax billing are not handled by the same officers? Has the SMI owner been billed for council tax (as he should have been), but the benefits section is refusing to award CTR on the basis that he shouldn’t be liable (which is wrong)? If so, the lack of joined-up administration is really poor.
If a bill has been issued to the parents on the basis that they are liable, they need to dispute that through the council tax appeals system (a sort of MR stage, followed by a directly lodged appeal to the Valuation Tribunal) and in the meantime the owner needs to protect his position in order to avoid future time limit problems: if he has not made a formal application for CTR he should do so; if he has had an application rejected he should also dispute it through the VT route. The worst outcome (which is not uncommon) is that it takes the council months or even years to get the billing situation sorted out, by which time it is too late for CTR to be claimed/appealed by the liable person: a frequently seen variation of this scenario is where the landlord and tenant are in dispute about who should be liable (is it an HMO or not) and when the dust settles it turns out the tenant is liable ... but s/he has taken no steps to claim CTR in the meantime. Anyone who foresees a backdated CT liability being established at some point down the line and whose income supports CTR entitlement needs to submit a preemptive/protective CTR application a.s.a.p.
Thank you that is extremely helpful.
I disagree, the person with SMI cannot be liable - Section 6(4) of the local government finance act 1992 excludes him from liability and his parents are therefore liable.
s6 (4) would apply if the parents were joint owners but they aren’t. Where the sole resident owner is SMI with other residents present as non dependents it is the SMI owner who is liable. Section 6 (4) only helps where there are others at the same level in the hierarchy
Thank you for correcting me :)