Council tax in England for people living in band D homes has increased by 4.7%, an average of £78.
As of April, the levy on an average Band D property will go up from £1,671 to £1,750 for 2019-20.
As reported by the BBC, the government has stated that the rise – the second biggest increase in a decade – is due to the cost of policing and adult social care.
Overall, councils will be collecting £31.4bn, including a £200m contribution towards social care, from residents in 23.6m homes across England.
Local authorities in England are allowed to raise their council tax by 2.99%, plus a further 2% if they provide social care. Any that want to exceed this must hold a referendum.
Bev Budsworth MD of The Debt Advisor said: “The council tax funding model appears broken with councils having no choice but to seek to raise extra funds due to funding cuts.
“However, this will without a doubt push many people over the edge. Thankfully we do have debt solutions like IVAs that can help deal with arrears of council tax.”
Why are council tax bills rising?
The latest increase means council tax bills will be rising by double the rate of inflation this year.
In the last three years alone, council tax has risen by a total of nearly 15%.
This is partly because of councils being permitted to raise bills by up to 2% to fund adult social care, but also because councils say they have been hit hard by cuts in government funds over the last decade.
The latest increase comes after they revealed they are braced for a further potential £3bn cut in funding this year, which could affect services across the UK.
Overall, the funding central government gives to local authorities will have fallen by a total of almost 60% this decade.
Even with the latest increase in council tax, the Local Government Association has warned that councils could face a funding gap of £7.8bn by 2025.
This is likely to put further pressure on services which means that despite an increase in council tax rates, local services may not actually experience a boost.
What is council tax?
Council tax is a local tax collected by your local council which helps to pay for a wide range of public services in your community.
Those services include:
- Planning
- Transport
- Roads
- Police
- Fire
- Libraries
- Leisure and recreation
- Rubbish collection and disposal
- Environmental health
- Trading standards
In England and Scotland there are eight property price bands, ranging from A to H, based on the value of your property. In Wales, the range is A to I.
Northern Ireland has a different local tax called rates.
What are the council tax bands?
The valuation band ranges for England are as follows:
| Council tax band | Ranges of value |
| A | Up to £40,000 |
| B | More than £40,000 and up to £52,000 |
| C | More than £52,000 and up to £68,000 |
| D | More than £68,000 and up to £88,000 |
| E | More than £88,000 and up to £120,000 |
| F | More than £120,000 and up to £160,000 |
| G | More than £160,000 and up to £320,000 |
| H | More than £320,000 |
The valuation band ranges for Scotland are as follows:
| Council tax band | Ranges of value |
| A | Up to £27,000 |
| B | More than £27,000 and up to £35,000 |
| C | More than £35,000 and up to £45,000 |
| D | More than £45,000 and up to £58,000 |
| E | More than £58,000 and up to £80,000 |
| F | More than £800,000 and up to £106,000 |
| G | More than £106,000 and up to £212,000 |
| H | More than £212,000 |
The valuation band ranges for Wales are as follows:
| Council tax band | Ranges of value |
| A | Up to £44,000 |
| B | More than £44,000 and up to £65,000 |
| C | More than £65,000 and up to £91,000 |
| D | More than £91,000 and up to £123,000 |
| E | More than £123,000 and up to £162,000 |
| F | More than £162,000 and up to £223,000 |
| G | More than £223,000 and up to £324,000 |
| H | More than £324,000 and up to £424,000 |
| I | More than £424,000 |
How is council tax paid?
Every April you will be sent an annual bill detailing how much you need to pay, with the option to pay upfront or in instalments.
Council tax bills usually show the payments over a 10 month period but you can also spread the payment plan across 12 months. Your local authority must let you pay over 12 months if you request it.
If your council tax bill was sent out later because you’ve moved house, you’ll have a shorter time to pay it and the bill will have to be paid off in full before the end of the following March.
Help with council tax debt
If you are falling behind on your council tax payments and getting into debt, seek debt advice from our professional Debt Advisors.
Arrears of council tax can be included in solutions like Individual Voluntary Arrangements. Many councils are supportive of IVAs although there are some who do take a hard line.
The Debt Advisor Ltd is authorised and regulated by The Financial Conduct Authority, number 659920.
This means we are able to offer debt advice and deliver both formal and informal debt solutions. We hope that the information and debt advice on this site including Frequently Asked Questions, will help inform you.
To speak to one of our advisors about IVAs and other debt solutions, you can request a callback or call us directly on 0800 085 1825. All debt solutions do need to be carefully considered.
There are sources of free debt advice and services. You can find out more by contacting the Money Advice Service on 0800 138 7777 or by visiting their website.
