How is Council Tax calculated?

The Council Tax valuation list has an entry for every chargeable dwelling in a billing authority's area. The list can be altered in prescribed circumstances and to that end there are rights to make proposals to alter the list and rights of inspection.

It is now possible to view all property bands on-line at The Valuation Agency's website

Valuation list

The Commissioners for Inland Revenue appoint a Listing Officer for each billing authority and it is the duty of the Listing Officer to prepare and maintain the valuation list for that authority.

The list must show an entry for each dwelling in the authority's area, the valuation band for each dwelling, and other consequential information. Preparation for a list starts in advance of it coming in to force and the valuations are as at an earlier date. This is known as the antecedent date and list that came into force in April 1993 was based on values as at April 1991.

Valuation bands

The value is the amount the dwelling might reasonably have been expected to realise if it had been sold on the open market by a willing vendor on the 1st April 1991 based on prescribed assumption. The bands in England are for properties valued as follows:

Band From To
A £0     £40,000
B £40,001  £52,000
C £52,001 £68,000
D £68,001 £88,000
E £88,001 £120,000
F £120,001 £160,000
G £160,001 £320,000
H £320,001 £320,001+

Valuation assumptions

In the case of a composite property the value of the dwelling shall be that portion of the amount that can reasonably be attributed to domestic use of the dwelling.

In all other cases the assumptions are:

  • Vacant possession
  • Interest sold was freehold or a flat with a 99 year lease at a nominal rent
  • Sold free from any rent charge or other encumbrance
  • Layout/character of the dwelling and locality are as at the relevant date
  • The dwelling was in a state of reasonable repair
  • The purchaser liable to contribute towards upkeep of common parts
  • Fixtures for use by a physically disabled person not included
  • Use would be permanently restricted to a private dwelling
  • No development value except that attributable to permitted development

Alterations to the valuation list

An alteration to the valuation list can only be made if one of the following circumstances has occurred and the effective date of a change is dependant on the circumstances:

  • A 'material increase'
  • A 'material reduction'
  • A 'relevant transaction'
  • The property has become or ceased to be a composite property
  • The amount of domestic use of a composite dwelling has changed
  • The valuation band is incorrectly shown
  • To reflect an order of a valuation tribunal or of the High Court

Proposals

The taxpayer, owner or relevant person of a dwelling, or the billing authority in whose area the dwelling is located may, within prescribed time limits, make a proposal to the listing officer to alter the valuation list in the following circumstances:

  • The list shows a dwelling which ought not to be shown
  • The list fails to show a dwelling which ought to be shown
  • The list shows a valuation band other than that which should be shown
  • One or more relevant events has occurred
  • Account has not been taken of a valuation tribunal or the High Court decision

The listing officer may serve a notice on the proposer within four weeks if he considers a proposal is invalid. Within four weeks of receiving the notice the proposer may serve another proposal or appeal against the notice. A proposer may withdraw his proposal providing he is still the taxpayer or receives the consent of the new taxpayer and there are provisions for the proposal to be settled by agreement.

Where a proposal is not settled within six months the Listing Officer will submit the proposal as an appeal to the Valuation Tribunal.

Settlement of a proposal by agreement

A proposal to amend a valuation list can be settled by agreement if the agreement is in writing and signed by the listing officer, proposer, taxpayer and any other person, including the billing authority, who indicates within three months of receiving a copy of the proposal that they wish to be a party to the proposal.

Right of inspection

A person has extensive rights to inspect a valuation list, a proposed new list, a list that has been in force during the previous five years, or an outstanding proposal to amend a list. They may make copies or, on payment of a reasonable charge, require the person with the documents to supply a copy. Where access is given in a non-documentary form the person may make a transcript copy or require the person with control of the information to supply a copy in documentary form. If access or copies are not made without reasonable excuse the person with or controlling a document shall be liable on summary conviction to a fine not exceeding level 2 on the standard scale.

Effective date of an amendment

The effective date for a dwelling included in the list for the first time is determined by the completion notice and when an existing entry is deleted the effective date will be the day the relevant works commenced. Where an alteration reflects a material increase in the value of a dwelling the effective date for any band increase will be the date of the next relevant transaction (ie the next date of sale of the property) or the date of the next general Revaluation, whichever is earlier. Where it is to reflect a material reduction it will be the day the circumstances required the reduction.

Where an alteration refers to a composite property the effective date will be the day on which the circumstances which caused the alteration arose and where an amendment is as a result of an order made by a Valuation Tribunal the effective date will be determined in accordance with the tribunal rules. Where an alteration is made to correct an inaccuracy in a list on the day it was compiled the effective date will be the day on which the list became inaccurate.

Timing of a proposal

No proposal in relation to an entry that has been the subject of a Valuation Tribunal or High Court decisions may be made until after the expiry of six months after the decision was made. Subject to restrictions, a person who becomes the taxpayer of a dwelling may make a proposal for the alteration of that dwelling if he has not previously been the taxpayer for that dwelling.

The restrictions are:

  • Six months has expired since the person first became the taxpayer
  • The same facts have been considered by a Valuation Tribunal or the High Court
  • Either the new or immediately preceding taxpayer is a subsidiary company of the other or of a common parent company
  • The change of taxpayer is because of an amended partnership and one of the partners was a partner in the previous partnership.