Martin Lewis warns hundreds of thousands of homes could be in the wrong council tax band, with refunds of thousands of pounds possible
Brits are being urged to double-check their council tax bills, as countless households could be due significant refunds. The warning comes as council tax charges nationwide are poised to jump on April 1, with the majority of local authorities hiking rates by five per cent.
Money-saving guru Martin Lewis has previously flagged on his Money Saving Expert (MSE) website that potentially hundreds of thousands of homes across England and Scotland may have been wrongly placed in the council tax banding system. He warned that these errors could have gone unnoticed for years, with refunds running into thousands of pounds becoming “commonplace”.
Council tax is a charge levied by local authorities to pay for essential public services such as bin collections, highway upkeep and libraries. A slice of the funds also goes towards local police forces and fire brigades, meaning what you pay depends on both your location and property type, with homes sorted into different bands.
But here’s where problems arise. In guidance featured on MSE, Martin explained how properties throughout England and Scotland might be wrongly classified, leading to incorrect council tax bills. He explained: “Hundreds of thousands of homes across England and Scotland are thought to be in the wrong council tax band.
“This means it’s important to check your property’s in the right band – something our tried-and-tested system can help you do. Some homeowners and renters have unknowingly been overpaying Council Tax for many years, even decades, because their bands are too high, so payouts worth £1,000s are commonplace.”
He disclosed that “many” properties have been stuck in incorrect council tax bands since 1991. When the new council tax system was rolled out that year, limited resources meant countless homes were valued with “just a glance”, with assessors merely driving by.
Welsh homeowners have been more fortunate, as the Government carried out a full revaluation of all properties, ensuring residents now pay the correct amount. Unfortunately, England and Scotland haven’t benefited from the same treatment.
“So the flawed old valuation still dictates much of England and Scotland’s banding, which is why you could be paying more than your neighbour even though you live in exactly the same size property,” Martin noted.
There are several ways to check whether you’re being stung for too much council tax. You can:
- Compare your band with neighbours’ in similar or identical properties – either by asking them directly or checking the GOV.UK website
- Work out your property’s 1991 value – the easiest method is to use websites such as Nethouseprices, Zoopla and Rightmove. What to do if you believe you’re in the wrong band
If you live in England or Wales and believe your property has been assigned to the incorrect band, Martin recommended that you should challenge it. First, you’ll need to determine whether you can do this “formally” or “informally”.
To submit a formal challenge, you must have lived at the property for no longer than six months (whether you’re a homeowner or tenant doesn’t matter, though tenants should notify their landlord as a courtesy). The Money Saving Expert website explained: “If you’re able to challenge formally (also known as a ‘proposal’), the Valuation Office Agency (VOA) must review your band. Although you don’t have to officially provide evidence about nearby properties, we’d strongly suggest you don’t skip that part.”
If you’ve been residing there for more than six months, the VOA has a legal duty to maintain the accuracy of the Council Tax bands register. MSE explained: “This means you can still submit a request for an ‘informal review’ of your Council Tax band (use our template wording can help), though the burden is on you to provide compelling evidence that your band is wrong, to persuade the VOA to do the review (the following steps show what evidence to prepare).”
In Scotland, council tax bands are overseen by the Scottish Assessors’ Association (SAA). Simply enter your postcode into the Council Tax Bands search facility on the SAA website.
MSE explained: “In Scotland, the Scottish Assessors Association (SAA) deals with Council Tax band challenges, known as ‘proposals’. As we mentioned above, in Scotland there isn’t an informal route to challenge your band if you can’t challenge formally. That means you should always go through the formal system of challenging, known as making a proposal.”
Further details can be found on the Money Saving Expert website here.
