State pensioners handed 3 new Council Tax exemptions to cut bill to £0 | Personal Finance | Finance
State pensioners are being given three new ways to cut their Council Tax bill, potentially down to £0, under a rule change set to take effect next month.
Many state pensioners can get discounts on their council tax bills, which, depending on the council, can range from a percentage off the bill to a full 100% exemption, which cuts the bill to zero.
Because Council Tax is collected by each council individually, some local authorities have different rules to others about how big their discount for pensioners is, and any other benefits they want pensioners to claim in order to qualify (such as Pension Credit), or rules about how much income or savings pensioners can receive and still get a discount.
Age UK explains how Council Tax Reduction works. It says: “If you’re on a low income or receive certain benefits, you can get help from your local council when paying your Council Tax bill – this is known as Council Tax Reduction or Council Tax Support.
“There’s no set amount of Council Tax Reduction. What you get depends on your circumstances and where you live. Each local council operates its own Council Tax Reduction scheme, so the amounts of support given across the country may vary.”
It adds that the reduction can reach 100%, bringing your bill to £0. It said: “If you receive the Guarantee Credit part of Pension Credit you may even get your Council Tax paid in full. If you don’t get Guarantee Credit but have a low income and less than £16,000 in savings, you may still get some help.”
This week, the Government’s Ministry of Housing, Communities and Local Government announced that there are several more types of benefits which have been added to the ‘disregards’ list for state pensioners.
It means that any income state pensioners receive from these benefits will not be counted in any council tax reduction calculation.
The government said: “Consistent with the wider benefits system, the Regulations make changes so that a pension age person’s claim is not affected by the receipt of certain payments.
adding a new disregard so that Miscarriage of Justice Compensation payments administered by Ministry of Justice do not affect entitlement to a reduction
adding a new disregard so that Adult Disability Allowance payments made under Scottish Adult Disability Living Allowance Regulations 2025 do not affect entitlement to a reduction where a recipient receives them for a transitional period after moving to England from Scotland
It also said that it is adding two measures which make it easier for people to receive a reduction if overseas and in a country subject to evacuation advice.
It added: “The Regulations also includes two measures to make it easier for persons to receive a council tax reduction where they are in a country or territory in respect of which the government advised British nationals to leave, or arranged evacuation:
allowing a pension age person who normally resides in Great Britain to receive support if they are temporarily absent from home for up to 26 weeks”
