If neither of these applies to you, the next step is to calculate the amount of your household’s weekly income. This is done by adding together all the money regularly coming into your home. Any money received at frequencies of more than a week should be converted to weekly amounts.

If you are self-employed you’ll normally be treated as earning the equivalent of a thirty-six-hour working week, paid at the national living wage.

After adding together all of your income, the next step is to subtract from this weekly amount any income that is shown in table A. This is income that we ignore when calculating your weekly income. 

Table A - Income we ignore when calculating your weekly income

  • DLA (Disability Living Allowance)
  • PIP (Personal Independence Payment)
  • £10 of Student Grants/ Loans
  • Carer's Allowance
  • 75% of child benefit
  • £20 Income from Boarders or rents
  • Foster/Guardian and Adoption payments
  • War disablement & Widows Pension
  • £20 of earned income (£50 if disabled and/or care leaver)
  • £50 maintenance for each child
  • Housing costs and disregarded income from Universal Credit

The final weekly amount is then compared to the table below. This is to determine the amount of Council Tax reduction you receive. This will be between zero and up to eighty percent of the maximum annual cap of £2,017.53.

For 2025-2026, if your annual charge is greater than £2,017.53, you are liable to pay the remaining amount of Council Tax in full. 

Net Weekly Income

Percentage of maximum reduction (%)

Less than or equal to £209.99

80

£210.00 to £259.99

70

£260.00 to £309.99

50

£310.00 to £359.99

30

£360.00 to £409.99

20

£410.00 to £459.99

10

£460.00 to £509.99

5

£510.00 and over

0

Additional important limits 

There are two other limits to the amount of reduction you receive, these are:

1. Non-dependent deductions

Any adult member of your family who lives with you is required to contribute towards the Council Tax you are charged. We call these individuals non-dependants.

The amount they are required to contribute is based on their income. This contribution is then subtracted from the amount of any reduction you are entitled to.

Contributions of non-dependant members of the household

The weekly financial contribution for each non-dependent member of your house will be:

  • £7.50 - non-worker
  • £15.00 - if they have gross annual earnings of £22,999 or less and
  • £38.69 - if they have gross annual earnings of £23,000 or above

2. Start dates of reduction awards

Your entitlement won’t start unless you have made an application and it has been approved. Entitlements will begin from the Monday following the date at which you apply.  

If your circumstances change and you are no longer entitled you must apply again.

If you are not entitled to a Council Tax Reduction at the start of the year, any reduction you receive will be calculated from the date of your application and not apply to your entire bill.

If you have moved into a new property you must apply for a reduction in the same week of your first bill. Otherwise you’ll need to pay the full charge up to the point at which you make an application.