Frequently Asked Questions in Relation to the COVID-19 Hardship Fund

The Government’s expectation is that all working-age Local Council Tax Support (LCTS) claimants in 2020-21 (who are entitled to working-age LCTS in respect of any part of the 2020-21 council tax liability) will receive a further discount of £150 from their council tax bill. 

Where, at the point a claimant first becomes entitled to working-age LCTS in 2020-21, their liability for the remainder of the financial year is less than £150, the discount will be applied to bring the liability down to nil. 

The reduction is to be made through the use of powers under section 13A(1)(c) of the Local Government Finance Act 1992 and is referred to in this document as a hardship fund discount. 

The hardship fund discount will be applied at the point a claimant first becomes entitled to working-age Local Council Tax Support (LCTS) in 2020-21. 

It will be applied against the claimant’s liability for the remainder of the financial year, after the application of any relevant discounts, exemptions and council tax support. Where the liability for the remainder of the financial year is less than £150, the discount will be applied to bring the liability down to nil.

A current working-age LCTS claimant whose LCTS eligibility ends part way through the year (or who reaches pension-age and switches to pension-age LCTS), should retain their hardship fund discount unaltered. 

A claimant receiving working-age LCTS for the first time from, for example, mid-year, should also be entitled to a full £150 discount against their liability for the remainder of the financial year, after the application of any relevant discounts, exemptions and council tax support. Where the liability for the remainder of the financial year is less than £150, the discount should be applied to bring the liability down to nil.

The discount will be applied to the council tax account reducing the amount of the bill.  If a balance remains after the award of the £150 this will be payable over the usual instalments and the bill will detail the new instalments that should be paid.

An individual’s liability may change mid-year due to a change in their circumstances which impacts on relevant discounts, exemptions or level of council tax support. In such cases, we may also need to reassess the level of hardship fund discount. 

If liability increases, and an individual had not previously been entitled to a full hardship fund discount because their former liability was less than £150, they should receive a further reduction to take their total hardship fund discount to £150, even if their Local Council Tax Support (LCTS) eligibility has ended. 

If liability decreases mid-year (as a result of increased eligibility for LCTS or discounts and exemptions), we may need to reassess the level of hardship fund discount, noting that the level of discounts cannot exceed the total liability.

Please note that a council taxpayer’s liability cannot be reduced below nil.  

When individuals move address within an authority area, we will ensure that all working-age Local Council Tax Support (LCTS) recipients receive a discount of £150 against their total council tax liability from the point they first became entitled to LCTS.

Where individuals are jointly and severally liable for council tax, and any of the individuals are entitled to Local Council Tax Support (LCTS), the reduction of £150 will be applied to the liability for the whole property (regardless of whether one or all of the liable parties are entitled to LCTS), from the earliest date of LCTS entitlement for any of the liable parties.