How we calculate Council Tax support

To calculate how much Council Tax support you are entitled to, we add together all your earned and unearned income. If you have a partner, we’ll include their income too.

We’ll deduct Income Tax, National Insurance and half of any pension contributions from your gross earnings.

We’ll make also make deductions and allowances for things such as student loans, savings and childcare.

Working out your income if you are employed

If you’re paid monthly, we’ll work out the deductions using the average of two monthly payslips. The average is then converted into a weekly figure.

You’ll need to show us either two monthly payslips, two four-weekly payslips, three fortnightly payslips or five weekly payslips. All payslips must follow on from each other.

If you’ve just started work and don’t have these payslips, you can provide:

  • one payslip
  • your contract of employment
  • a letter from your employer confirming the number of hours you are due to work each week and your hourly pay, or the number of hours you are due to work each week and your annual salary
  • a Certificate of Earned Income form which must be completed and stamped by your employer

You will still need to provide the payslips listed above once you have received them.

Working out your income if you are self-employed

If you’re self-employed, we’ll need to see your accounts. They should be for a recent trading period, for example the most recent financial year, or the last six to 12 months.

You’ll also need to supply evidence of your income and expenses by providing invoices and receipts for the relevant trading period.

We will work out your profit for the trading period and make the deductions. The remaining profit is then converted into a weekly figure.

If you have just started self-employment you can:

  • provide a self-employed account for the last three months with proof of income and expenses
  • provide a projected self-employed account for three months from the start of your self-employment

Disregarded income

We don’t count some income for the calculation of Council Tax support, for example Child Benefit, Disability Living Allowance and 25% of money received from an ex-partner towards child maintenance.

We disregard a small amount from your earnings if you are working. This will depend on who is in your household and the number of weekly hours worked by you and, if you have one, your partner.

Applicable amount

We calculate Council Tax support using an applicable amount. This is a part of the means test.

It is the amount of money the government believes you (and your partner) need to meet your necessary weekly costs. The amount depends on the size and circumstances of your family.

We take your applicable amount away from your total weekly income and any remaining income is known as your excess income.

To work out your applicable amounts we add up:

Things that can affect the amount of Council Tax support you receive

Student income

We treat student loans, grants and bursaries as income for Council Tax support purposes. Find out about student income and Council Tax support.

Childcare costs

Some childcare costs are not counted when we are working our your entitlement. Find out more about how childcare costs are calculated for Council Tax support.

Capital – investments, properties and savings

Capital is anything that has a monetary value, such as land and property, investments and savings. Find out how capital can affect Council Tax support entitlement.

Non-dependants

A non-dependant is someone who normally lives with you such as an adult child, relative or friend and is not liable to pay Council Tax. Find out how non-dependants affect your Council Tax support entitlement calculation.

Backdating

Claims for Council Tax support can be backdated for three months.

All pensioner claims are backdated automatically for three months from the date the form is completed.