Martin Lewis MSE says these people could get discounts on council tax | UK | News

Council tax is set to increase on April 1, 2026. The precise rise in your bill will be determined by your location and the local council that governs your area. The majority of councils across England are implementing a maximum increase of 4.99%, the highest rate permissible without necessitating a referendum.

This includes a 2.99% surge for general services, coupled with a 2% levy for “adult social care”. On average, this equates to an annual increase of approximately £111 for a typical Band D property, pushing the average bill up to £2,392.

Certain people with specific medical conditions may be exempt from paying council tax and may qualify for a full 100% discount. Eligibility requires a medical diagnosis and receipt of certain benefits. Applications for this discount can be made via your local council’s website, reports the Liverpool Echo.

Those diagnosed with a permanent ‘Severe Mental Impairment’ (SMI), such as dementia, Parkinson’s disease, significant learning difficulties, or post-stroke effects, could be eligible for a council tax discount ranging from 25% to 100%, according to Martin Lewis’ Money Saving Expert (MSE). To qualify, you need a medical certificate confirming a permanent condition that affects cognitive and social abilities, in addition to receiving certain benefits.

According to MSE: “The SMI Council Tax discount is a reduction of a household’s Council Tax bill, worth, at a minimum, 25%, all the way up to, in some cases, the entire bill being wiped. SMI is a medical diagnosis in itself, but the underlying cause could be a condition such as dementia (including Alzheimer’s), profound learning difficulties, multiple sclerosis, the result of a severe stroke or something else.”

Discussing the discount on a previous episode of The Martin Lewis Money Show, the finance expert stated: “A severe mental impairment – horrible term not mine – is defined as a severe mental impairment of intelligence and social functioning which appears to be permanent. To qualify for a discount, it must be medically certified; you need a doctor to sign.”

Your discount depends on your household circumstances

MSE explains that Council Tax reductions are calculated based on how many qualifying adults live in the property.

• A person with SMI who is living alone can get 100% discount on their household.
• A person with SMI who is living with an adult carer can get 50% on their household.
• A person with SMI who lives with one qualifying adult can get a 25% discount on their household.
• A person with SMI who is living with two or more qualifying adults won’t get a discount

The organisation clarifies: “And just to be clear, if there are under-18s, full-time students or others with SMI in the household as well, they don’t change the situation above (as they don’t count towards Council Tax either) – so a household where someone with an SMI lives with an under-18 still gets the 100% discount.”

Who qualifies for the SMI Council Tax discount?

According to MSE, there are two criteria that must be met by someone who is severely mentally impaired to qualify for this Council Tax reduction. Firstly, they must have been medically certified as being ‘severely mentally impaired’.

MSE states: “For example, this may be the case if they have dementia (including Alzheimer’s), Parkinson’s, severe learning difficulties, multiple sclerosis, complications from cerebral palsy or have had a stroke.” Eligibility for the discount is determined by individual circumstances.

Medical conditions classified as SMI for council tax exemption:

• Dementia (including Alzheimer’s disease)
• Parkinson’s disease
• Severe learning difficulties
• Multiple sclerosis
• Long-lasting effects of a severe stroke
• Schizophrenia
• Schizoaffective disorder
• Other severe, permanent cognitive disorders

Having a diagnosis of one of these conditions doesn’t automatically entitle you to the reduction. Medical confirmation of ‘severe mental impairment’ is required from a doctor, and crucially, GPs are not allowed to impose charges for providing this certification.

Additionally, recipients must be claiming at least one of the following benefits, although this list may vary in Scotland:

• Incapacity benefit
• Attendance allowance
• Severe disablement allowance
• Disability living allowance (higher or middle-rate care component)
• Increase in disablement pension (due to constant attendance being needed)
• Unemployability supplement or allowance
• Constant attendance allowance
• Income support (which includes a disability premium)
• Personal independence payment (standard or enhanced daily living component)
• Armed forces independence payment

In England and Wales, eligibility extends to those receiving disability working allowance (based on income support, including the disability premium) and universal credit (including an element for limited capability for work or limited capability for work and work-related activity).

In Scotland, the qualification also encompasses those receiving tax credits (including the disability element), employment and support allowance, and universal credit. MSE emphasised: “It used to be the case in England and Wales that the person only had to be eligible for – but not necessarily actually receiving – the qualifying benefit, but this changed following a High Court ruling.

“The law is less clear cut in Scotland, and so with some Scottish councils it’s fine if you’re just eligible for the qualifying benefit, while with others you’ll need to actually be receiving the benefit. It’s a bit of a postcode lottery.”