Council tax band challenges soar in scramble to claim £150 energy bill rebate

Nearly 50,000 homeowners challenged their council tax last year after £150 energy bill rebates were handed out to homes in Bands A to D only.

More than 13,400 households were moved into a lower tax bracket following a challenge to the Valuation Office Agency in the 2021/22 tax year – a success rate of 29pc.

The number of homeowners challenging their band surged 22pc from 40,850 after the Government announced only those in certain council tax bands would receive the rebate cash.

All UK properties are divided into council tax bands A to H, which are based on property valuations from 1991. Over the years many people whose properties were incorrectly valued at the time have been able to claim back compensation by asking the VOA to review their band.

The VOA said that more people had come forward questioning their band after the announcement of the energy rebate on 3 February 2022. Under the scheme, households in bands A to D in England – the lowest rates – are entitled to a £150 rebate on their council tax bills to help with rising energy costs.

Around 80pc of households are eligible for the handout. But nearly five million families will miss out because they live in homes outside of the qualifying bands. In some cases, these may be low-income families who happen to reside in properties that were highly valued in the 1990s – an inequality which contributed to almost 10,000 more people challenging their band last year.

Although many did secure a discount, in 63pc of cases, people’s tax bands went unchanged. And 50 households ended up paying more tax after being moved into a higher band following a challenge. When one house on a street goes up a band, it can lead to the neighbouring properties paying a higher rate of council tax as well.

To challenge their band, people should contact the VOA. They will need to provide evidence that their property was incorrectly valued in 1991.

They can also argue the valuation is now incorrect because of changes to the property – for instance, if a part of it has been demolished. In these cases taxpayers must make a “proposal” to the local council. If rejected, they can appeal to the Valuation Tribunal requesting a review.