Council Tax Reduction Scheme 2027/28

Council Tax is a local tax charged on domestic properties. It helps fund local services provided by the Council, including adult social care, children's services, waste collection, libraries, parks and highways.

The amount of Council Tax payable depends on a property's valuation band, together with any discounts, exemptions or reductions that may apply.

Council Tax Reduction (CTR) is to help people who are on a low income to pay part or all of their Council Tax.

For more information on the current scheme, and who is eligible, visit:

Council Tax Reduction eligibility 2026/2027 - Wandsworth Borough Council

The Council reviews its CTR Scheme each year. This consultation sets out proposed changes for the four-year period from 2027/28 to 2030/31 to provide greater certainty about how support would be delivered in the future.

Wandsworth Council has had to make the difficult decision to increase Council Tax in 2027/28 following changes to Government funding. As a result, the cost of maintaining the current CTR Scheme is expected to increase from £6.9 million to £13.7 million if left unadjusted.

The Council considers the current scheme to be financially unsustainable at this higher cost. Under the proposed scheme, spending on Council Tax Reduction is estimated to increase from £6.9 million to £12.4 million in 2027/28 before gradually reducing over the following four years to an estimated £7.1 million by 2030/31.

This phased approach is intended to help residents adjust to higher Council Tax bills over time while returning the scheme to a more financially sustainable long-term cost.

The Council recognises that many households would pay more Council Tax under these proposals. To help residents adjust, any changes would be introduced gradually between 2027/28 and 2030/31.

The Council is proposing changes to the CTR Scheme for working-age residents from April 2027.

The aim is to continue providing support to residents on low incomes while ensuring the scheme remains affordable for the Council in the future.

The level of support provided to pensioners by the scheme is set by the government, therefore if you are a pensioner the level of support you receive will be unaffected by the consultation proposals. 

The Council is proposing to:

• Remove the current Working Age 1 category, which provides 100% Council Tax Reduction (see below for more detail). Households in this category would be reallocated into the most appropriate working-age category (WA2 to WA5). This would impact 74% of residents currently in receipt of CTR.
   
• Require all working-age households in the scheme to pay something towards their Council Tax bill.
   

• Introduce additional income bands for some low-income working households, extending support to residents who are not currently eligible for Council Tax Reduction.

• Gradually reduce the level of support available to working-age households over four years between 2027/28 and 2030/31.

Please click here to view the new proposed CTR categories in more detail.

  Who is currently in the WA1 category?

The WA1 category currently provides 100% Council Tax Reduction to:

• households with a child under the age of three and no earned income; and
• households receiving certain disability-related benefits where the household has no earned income, or earnings below the relevant income thresholds.

Full details of the current eligibility criteria can be found on the Council website. 

The proposed changes would affect all working-age residents who currently receive Council Tax Reduction.

This includes many households who currently receive the highest level of support and therefore pay little or no Council Tax.

Under the proposed scheme:

• Most working-age households currently receiving Council Tax Reduction would receive less support than they receive now.
   

• Some low-income working households that currently receive no Council Tax Reduction may become entitled to support under the revised income bands.

• Support would be reduced gradually over a four-year period rather than through a single change.
   
• Pension-age residents would not be affected by these proposals because their entitlement is set through a national scheme.

The impact would vary depending on individual household circumstances, including income, savings, household composition and any disabilities.

The examples below are intended to illustrate how different households could be affected by the proposed changes. They are based on a Band D property and are for illustrative purposes only. Actual entitlement would depend on individual household circumstances.

Example 1: Household out of work with a child under 3

• Current annual Council Tax bill: £0 (100% CTR)
• Estimated annual Council Tax bill in 2027/28: £180 (91% CTR)
• Estimated annual Council Tax bill in 2030/31: £988 (52% CTR)

Example 2: Household out of work with a disability (no children)

• Current annual Council Tax bill: £0 (100% CTR)
• Estimated annual Council Tax bill in 2027/28: £365 (82% CTR)
• Estimated annual Council Tax bill in 2030/31: £1,071 (48% CTR)

Example 3: Working lone parent with children and a disability

• Current annual Council Tax bill: £0 (100% CTR)
• Estimated annual Council Tax bill in 2027/28: £245 (83% CTR)
• Estimated annual Council Tax bill in 2030/31: £1,004 (35% CTR)

Example 4: Working couple with children and a disability

• Current annual Council Tax bill: £0 (100% CTR)
• Estimated annual Council Tax bill in 2027/28: £320 (84% CTR)
• Estimated annual Council Tax bill in 2030/31: £1,236 (40% CTR)

Example 5: Working single person with a disability

• Current annual Council Tax bill: £0 (100% CTR)
• Estimated annual Council Tax bill in 2027/28: £300 (80% CTR)
• Estimated annual Council Tax bill in 2030/31: £1,158 (25% CTR)

Example 6: Working couple with a disability

• Current annual Council Tax bill: £0 (100% CTR)
• Estimated annual Council Tax bill in 2027/28: £393 (80% CTR)
• Estimated annual Council Tax bill in 2030/31: £1,442 (25% CTR)

Example 7: Lone parent with up to 2 children (£250-£350 weekly income)

This household does not currently receive Council Tax Reduction but would become eligible for support under the proposed scheme.

• Current annual Council Tax bill: £1,020 (No CTR)
• Estimated annual Council Tax bill in 2027/28: £889 (40% CTR)
• Estimated annual Council Tax bill in 2030/31: £1,390 (10% CTR)

Example 8: Couple with 3 or more children (£275-£350 weekly income)

This household does not currently receive Council Tax Reduction but would become eligible for support under the proposed scheme.

• Current annual Council Tax bill: £1,020 (No CTR)
• Estimated annual Council Tax bill in 2027/28: £1,185 (40% CTR)
• Estimated annual Council Tax bill in 2030/31: £1,853 (10% CTR)

Example 9: Single person with no children (£125-£200 weekly income)

This household does not currently receive Council Tax Reduction but would become eligible for support under the proposed scheme.

• Current annual Council Tax bill: £1,020 (No CTR)
• Estimated annual Council Tax bill in 2027/28: £893 (40% CTR)
• Estimated annual Council Tax bill in 2030/31: £1,421 (8% CTR)

Example 10: Couple with no children (£160-£250 weekly income)

This household does not currently receive Council Tax Reduction but would become eligible for support under the proposed scheme.

• Current annual Council Tax bill: £1,202 (No CTR)
• Estimated annual Council Tax bill in 2027/28: £1,191 (40% CTR)
• Estimated annual Council Tax bill in 2030/31: £1,895 (8% CTR)

Further, more detailed examples can be found here.

No. The proposed increase to Council Tax in 2027/28 is based on balancing the general fund budget at zero in 2030/31, with no surplus or use of reserves in that year and no further tax increases assumed. Because the Council Tax Reduction Scheme will return to an overall cost of £7.1 million by 2030/31, the initial cost isn’t a factor in the proposed increase of 94%.

The current Council Tax Reduction Scheme costs around £6.9 million each year.

Due to the proposed increase in Council Tax, the cost of maintaining support under the proposed scheme is estimated to increase to £12.4 million in 2027/28, based on current claimant numbers.

The proposed changes would then gradually reduce the cost of the scheme over the following four years. By 2030/31, the annual cost is estimated to be approximately £7.1 million.

This approach is intended to continue providing support to low-income households while returning the scheme to a more sustainable long-term cost.

The Council considered three options when reviewing the future of the CTR Scheme for working-age residents. 

Option 1: Keep the current scheme unchanged

This option would retain the current scheme and existing levels of support. However, modelling showed that the cost of the CTR scheme could increase from £6.9 million to around £14.3 million per year by 2030/31. The Council considered this option to be financially unsustainable in the longer term. 

Option 2: Make the same changes, but reduce support more quickly

This option would include the same structural changes proposed under Option 3, including removing the WA1 category and introducing new income bands for some low-income working households. However, support would reduce more quickly during the first three years, resulting in larger increases in Council Tax bills for many households during the early years of implementation.

Option 3: Make the same changes, but reduce support more gradually

This is the option we're proposing and are asking for your views on. It includes the same changes as Option 2 but phases the reductions in support more gradually during the first three years. The Council considers this option to provide a better balance between reducing the cost of the scheme and giving affected households more time to adjust to the changes.