Moving into new accommodation – what do you need to know about council tax?

It’s a new academic year and many students will be moving into rental accommodation, perhaps for the first time. One of the many things that students will need to sort out is whether they need to pay council tax.

It is often assumed that students are exempt but that is not necessarily correct as it depends on where you live and who you live with.

What is council tax?

Council tax is charged by local authorities (councils) to pay for services such as rubbish collection, policing and the fire service.

Council tax is charged on the household. It is based on the value of the property and not on what the household earns.

If you are the property owner then it will be your responsibility to pay the council tax. If you are moving into rented accommodation then check your lease agreement as it may be your responsibility or your landlord’s.

Even if it is your responsibility to pay council tax you may be exempt depending on where you live and who you share the house with.

Location, location, location

So why does it matter where you live? Because the rules on who pays council tax (or rates as they are called in Northern Ireland) vary depending on which country and which local authority you live in.

The general rule in England and Wales is that if you are living with full-time students then the household should be exempt from council tax. However, each local authority has the power to set its own rules so it is worth checking to make sure your household is exempt.

There is more information about the rules in Scotland and Northern Ireland in our tax essentials section.

Who are your housemates?

So as explained above, many student households will be exempt from council tax if they are all full-time students. To be classed as a full-time student you need to be on a course for at least 12 months and studying for more than 21 hours a week.

If you are living in a household where not all of you are full-time students then the household may still qualify for a discount or rebate – check with your local authority to find out what you are entitled to.

It may be the case that the circumstances of a member of your household change, for example, they may decide to become a part-time student or leave their course altogether. This may mean that the household loses their complete exemption, however as explained above you may still be able to reduce your council tax through a rebate or discount.

There is more information on council tax on the Low Income Tax Reform Group website.

(15-09-2014)