Martin Lewis is urging households in certain parts of the UK to check their Council Tax bands, as they may be owed payouts worth thousands of pounds. Part of an article on the Money Saving Expert (MSE) website reads: "It's important to check your property is in the right one – something our tried-and-tested system can help with. Some homeowners and renters have been overpaying Council Tax for many years, even decades, because they're in too high a band."
How Council Tax Bands Work
There are eight bands altogether, ranging from A through to H, and the band allocated to your property dictates your monthly Council Tax bill. A represents the lowest band, while H is the highest. Writing on MSE, Mr Lewis states that numerous properties remain in incorrect Council Tax bands, having been so since 1991.
Properties were assigned to bands according to their "worth" at that time, but the system was flawed due to the Government working under severe time constraints. While Welsh properties were reassessed in 2005, no equivalent review has taken place in England or Scotland. This, Mr Lewis explains, is why "you could be paying more than your neighbour even though you live in exactly the same size property".
Two Initial Checks to Consider
To determine whether your band is set too high, MSE suggests starting with two initial steps. First, check whether your Council Tax band exceeds that of neighbours residing in comparable or identical properties. You can do this online in England here, and in Scotland here. "If neighbours in similar properties are in a lower band than you, then you may have a claim. But it could mean they're all in the wrong band." In certain instances, rather than your band being reduced, your neighbours might be shifted into a more costly one.
Secondly, you'll need to work out what your property was valued at back in 1991. If you purchased your house after 1991, you can straightforwardly use its sale price and date to establish this. If you're renting or bought earlier, you'll need to obtain an estimated valuation. Free property valuation websites such as Zoopla and Rightmove can assist you with this. You can then use a useful MSE tool to calculate the home's worth in 1991, and determine which band the property would have fallen into at that time.
When to Challenge Your Band
MSE adds: "Warning - only challenge [your Council Tax band] if you pass both checks above". You're also only able to challenge your Council Tax band if you've resided in the property for a minimum of six months. To find out how to challenge your Council Tax band, and to read the MSE article in full, click here.
