Are you in the wrong council tax band?

Are you in the wrong council tax band?

A quick check of your council tax could save you money – and get you a rebate worth hundreds, maybe thousands of pounds. It is estimated that up to 400,000 homes in England and Scotland could have been placed in the wrong council tax band. A 10 minute check will show you if you are being overcharged, past or present.

At no cost to yourself you can challenge your banding, not only slashing what you pay now, but also getting a backdated rebate stretching back as far as 1993.

Thousands of people have already been successful in challenging the banding and pay-outs in the £1,000s are commonplace. This is a step-by-step guide to see if you can join the success stories.

You may be paying too much council tax

Back in 1991 when the government launched its new council tax system, they needed every property in the land to be put into a valuation band. The task was huge, so much so that the people in charge asked estate agents and others to help.

Even with all the estate agents’ help, they simply didn’t have the time or resources to get detailed information together; they set about doing it quickly by pairing up and driving down countless streets allocating a band to properties just by taking a glance.

These became known as ‘second-gear valuations’ as in most instances they never even stopped the car to investigate properly, let alone get out of them!

After all this time, homes in England and Scotland have still not had their homes reassessed to make sure they are correct (though the Welsh government reassessed all homes in Wales).

So, thanks to this quick’n’dirty valuation system, if you live in England or Scotland you could be paying significantly more than your neighbour, even though you live in exactly the same size property.

How much can you expect to get back?

There is no set amount. If you were to get your banding decreased you could be paying as much as £100-£400 less each year. On top of that, the repayment should be backdated to when you first moved into the property, as far back as when the tax first started in 1993.

Council tax reclaiming: Step-by-step

The most important thing is to check if your band is higher than your neighbours in similar or identical properties.

You can simply ask them, but if you don’t fancy that don’t worry as it is public information. The band of every home in England and Scotland is available via these websites:

Step one: The Neighbours Check

It’s vital that you first check your band, followed by your neighbours’. Make sure the properties are as close as possible in size and valuation.

Due to the sheer size of the database, some properties have been missed off. If this is the case for you, ask your neighbour or contact the council and ask why.

If you find your neighbours in similar properties are in a lower band than you, you may have a claim, though it could be that they’re all in the wrong band. This is what happened to a street in Hull, when one of its residents appealed that she was in the wrong band. She was in band B when all her neighbours were in band A.

Instead of getting a rebate, the rest of the street got a bill for the outstanding amount as she was the only one banded correctly. This is why it is vital that you also do the valuation check below.

Step two: The Valuation Check

The second thing that you MUST do is to estimate the cost of your house in 1991, as that is when council tax bands were determined.

This cannot be used as evidence if you challenge your band, but it enables you to check out the various house prices on your street and it’s an important test that you’re on the right track if you do decide to challenge.

First value your house

If you bought your home after 1991, you can simply use the price and sale date to do this. If it was earlier than this you will need to find an estimated price.

Also check similar neighbouring properties to check there are no anomalies.

Use free house price websites

To find a price quickly, use a website which offers free historic sales price information. These include:

Note down the price and date

Find the most recent sale of a property similar to yours in your street. Note down the price and date of sale.

Now – find what it was worth in 1991

Once you have this information you can use it to estimate how much your property was worth in 1991 by using the Nationwide House Price Calculator.

How to use the calculator

  1. Scroll down the page to the calculator.
  2. In ‘Property value’ note the sales price from earlier.
  3. In ‘Valuation date 1’ enter the date of sale from earlier (make sure you enter which quarter of the year it was), and Q2.
  4. In ‘Valuation date 2’ enter 1991, and Q2.
  5. Select your region from the drop-down list.
  6. Click ‘calculate the results’.

The results, rather strangely, appear just above the calculator. For example:

A property located in the north west of England which was valued at £170,000 in Q2 of 2010 would be worth approximately £66,904 in Q2 of 1991. That’s equivalent to a -61% change.

Now you can compare the estimated valuation of your property in 1991 to the table below:

Council tax bands at 1991 property value

A All properties under £40,000 All properties under £27,000
B £40,001 – £52,000 £27,001 – £35,000
C £52,001 – £68,000 £35,001 – £45,000
D £68,001 – £88,000 £45,001 – £58,000
E £88,001 – £120,000 £58,001 – £80,000
F £120,001 – £160,000 £80,001 – £106,000
G £160,001 – £320,000 £106,001 – £212,000
H over £320,000 Over £212,000

Step three: Are you in the wrong band?

Challenging your band is not something to do on a whim without checks, for one simple reason:

Your neighbour’s band could be increased, although it is extremely rare.

It is absolutely crucial you do both checks, and are especially careful if you have added an extension to your home that could have increased your property’s value.

By far the most important check is the Neighbours’ Check, yet the secondary Valuation Check is useful for seeing whether your band is too high or your neighbours’ bands are too low.

Check out the table below to determine how strong your case is and help you decide if it is worth it.

Neighbours Check Valuation Check Have you got a good claim
Strong case
Moderate case (mild risk to neighbours)
Not worth the risk
No case

Source: MSE

Step four: Challenge it!

If you’re convinced your property band is unfair and you have completed both the checks above it’s time to challenge it.

If you’re in England explains how to go about challenging your council tax band. You can either contact the Valuation Office Agency (VOA) directly, at which point you’ll be told how your band was decided and have the opportunity to explain why you believe it is wrong and how it should be altered.

Alternatively you can check your band by entering your postcode and selecting your address from a list. Then you can click on the link asking if you think your council tax banding is wrong and you’ll be given the option to fill out a checklist which suggests reasons you could challenge.

In Scotland, the Scottish Assessors Association (SAA) deals with council tax bands. Enter your postcode in the Council Tax search box on the SAA Homepage. Select your property from the list. If you want to challenge the banding, click on “Make a proposal”. You can then fill in an online form which will be sent to your local assessor, who will contact you.

Remember the formal challenge checklist is more a safety check before doing the challenge. It’s got very limited value in your appeal. However, if you source actual sales prices from around 1991, that is stronger evidence.

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