The typical annual council tax bill for a Band D is £2,280, so this would rise to £2,394 next year – but here is how to cut your bill
Millions of households are set to see their council tax bill rise by 5% next year – but there are ways to cut your costs.
The Office for Budget Responsibility (OBR) revealed in documents released after the Budget that it assumes council tax bills in England will rise by this much next year.
This is the maximum councils in England can hike bills by without holding a referendum. This includes a 3% increase, plus an additional 2% for social care.
The typical annual council tax bill for a Band D is £2,280, so this would rise to £2,394 next year. It comes after Rachel Reeves announced a new “mansion tax” on the most expensive homes.
Properties worth more than £2million will be hit with a new surcharge from April 2028. Homeowners of properties valued between £2million and £2.5million will be charged £2,500 a year, while owners of properties above £5million will be charged £7,500.
How to cut your council tax bill
Ask your council if you’re eligible for a council tax discount. For example, if you live alone, you get 25% off your council tax bill. You get 50% off your bill if everyone living in your household is disregarded from paying council tax.
If you claim benefits or you’re on a low income, see if your local authority runs a Council Tax Support or Council Tax Reduction scheme. In some cases, you could be entitled to 100% off your bill.
Finally, see if you can challenge your council tax band. If you’re in too high of a band, you may be due thousands of pounds back, plus lower bills going forward. But do your research first, as if you’re in too low of a council tax band, your future bills will go up.
Council tax payments may be changing in the future
The government is currently consulting on plans to change to spread out council tax payments over 12 months, instead of ten months.
You can request your payments be split over 12 months instead, to give yourself smaller payments – but under the new plans, this will be the default.
The average band D household would pay approximately £38 less each month if they paid over 12 months, according to figures from the the Ministry of Housing, Communities and Local Government.
Households will still be able to pay their council tax bill over ten months if they want to. The consultation is also proposing slowing down the debt collection process for when someone has missed a council tax payment.
