Future Council Tax Reforms

BBC Sounds, Music, Radio Podcasts . They came up with the council tasks, and when two middle aged men get together , there's only one thing they talk about first. This is a substantial amount of money we're talking about for many people who are in the wrong bank. Just kissing my people . Premium bonds hugely popular, in my view, hugely overrated. Hello, I'm Martin L ewis and this is the comingly named the Martin Lewis podcast. I did wonder what that's going to be about . And this is our big topic episode where each week we leave on one main subject to help you say. Usually most of it comes from my BC radio five live show with Adrian Childs, but don't worry there's also boneless money saving tips and tricks and extra for you lucky lucky podcast listeners I got wheels . I got to pay . So I'm gonna work for I got a fee so I'm gonna make So what do you look for us today, Martin? Well, the big topic of the day is council tax costs. Five different ways you can slash your council tax. Some people are due serious money back thousands of pounds in refunds from overpaid council tax over the years. There are millions of people missing out on discounts and counsel tax support. It's a huge part of people's expendit ure and I'm going to run you through all the different ways that you can get money back and answer people's questions. We've also got to tell us and what's the biggest money secret you've ever kept? When was it? Who did you keep it secret from and why some fascinating responses there . We'll be talking about the increase in the premium bond rate. And there's a mastermind today, Adrian, as always . And today it's on the Lifetime ICEA, a subject we've talked about a good few times before on the show. Okay, I can't tell you how much I'm looking forward to it. Now I promise we're going to get into the podcast proper in a moment. We're going to be talking about council tax, how you check and challenge your band, why you may be missing out on a discount, why you may be missing out on council tax support. We're going to talk about the premium bomb rate, but Adrian and I are middle aged men, and when two middle aged men get together, there's only one thing they talk about first. I just got the giggles then Martin to me every time you come we meet each other . We start off a.ir We have a conversation like we might have in a care home in twenty years . Just aim where you take the cuffs gone. I'm just falling apart, I've got a cough, I've got head fever on my back. On my age, I'm a man in my early mid fift . I turned fifty four at the weekend. So I'm early mid fifties who does a lot of exercise . And I think you have to make the choice at our age. Either you're not going to do any exercise in which case your body's going to fall apart because you're not doing exercise or you're going to do lots of exercise in which case your body's going to break because you're doing lots of exercise. So I've been doing this press up thing where I wanted to do twenty thousand and then I increased my chance to twenty five thousand in a year, but my rotator cuff has now gone so, I haven't done press ups for ten days. Done eight thousand four hundred so far this year, but I'm now off the press ups and it's very frustrating. But it says something about your psychological makeup because you reduced it in what you said the whole thing to a binary absurdity is that you either do nothing and fall to pieces or do so much, you're knackering yourself. There is a happy median. I know he's not as exciting. I don't understand that I've never met a clairvoyant, but sorry that was a happy meeting. It was a terrible pump. No, I am, I'm a binary person. I'm naught or one. I don't have in between. You're naught or a hundred. Yeah, okay. Well, that wouldn't be binary age. To be fair. So that is how I operate. So my exercise , you know, I do cardio every morning, I do gym, not this week because of the rotor cuff, gym session and weight session at least five times a week and I do my seventy press ups a day. And I'm set and I don't like missing. You're doing press ups over. Didn't you start? Yeah, I just started. I went to do I went to do one and I could well I couldn't do one at first and I did one and I'm building on sixty in March next March and I'm w bean ablena to do sixty press ups before I'm sixty . So I'm doing I've got up to doing eight every day and I'm increasing by tasty sensible. The mistake I made, I do three sets of twenty five normally is I started putting my feet up on a chair to do them because I wanted to do incline press ups to get the upper part of the chest gets and work out as well. Why don't you get Lara to sit on your back while you're doing so well and your daughter and any family pets ? And then your father in law and everyone knows. Yeah, quite nice. Some breaking news about premium bonds are just given. Yeah so we're just hearing the premium bond fund rate is going to increase from three point three percent to three point eight percent in July. Premium bonds bigger single form of savings in the country, hugely popular , in my view, hugely overrated. Nowhere near as good returns as most people think, but people somehow like this, the infinitesimally small chance of you winning a million. I mean on a one, pound premium bo nd, you have a far better chance of landing three coins on their edge than you do of actually winning the million. It's billions to win against. But if you got a bit more, it can work. So let's just talk through premium bonds . They have this prize fund rate , which is three point eight percent or will be from July. And what people think is ah. So if I put one hundred quid in, I'd get three point eight percent of that, which is three pound eighty. That is not how it works. What you actually have is an incredibly complicated multinomial probability distribution to work out what you can win on average. So the smallest prize is twenty five pounds . So the likelihood is if you have a hundred pounds in there with what I call average luck, which I define as median luck, can you remember your three different averages? It's not Mastermind Dent work. Okay .. Got it mean average you had everything up and divided by the number of things. Correct . The median is when you put all the numbers in order and you pick the middle one. Correct. And I've forgotten the other one. The mode is the one where there's the single highest number of people in that category . Right. So I define average luck as median luck. So basically if we lined everybody up with a hundred pounds in a row in order of what they'd won. we And'd picked hundred a pounds of hundreds of the premium bonds in order of what they won a year and we pick the person in the middle, there is what I define as average luck. So it's the median average. So if you got a hundred pounds in, well, because the minimum pound it prizes twenty five quid at even at three point eight percent , the vast majority of people, I think it's probably haven't worked out the probability for concern just being announced. But I suspect over ninety percent of people will win nothing. And in fact, even if you have a thousand pounds in over a year with medium luck , you will win nothing because for everybody who wins a bigger and bigger and bigger prize, quite a lot of people have to win nothing , which is why the prize fund, which is the mean average is we're going to give out three point eight percent of the total number of premium bonds is actually higher than the median average. Line everybody up and put them in the middle. So with typical luck, even if you have the full fifty thousand pounds in , you would not get three point eight percent This next finger is made up, but it would probably be somewhere around three point five, three point six percent. And the less you have in with typical luck , the further away you are from likely getting the three point eight percent. So therefore, if we're looking at this as a clinical financial decision as opposed to valuing in, but there's a chance I could win a million. Then with typical luck , premium bonds are only really worth it for people who've got the maximum amount in which is fifty thousand pounds who have used up their cash is because premium bonds are tax free like cash is a tax free because cashes are currently paying, you know, the best cash is of four point five percent. Premium bonds are only three point eight percent on the price from rate and you're going to be paying tax outside of that ICER on your savings so you've used your personal savings allowance mainly at the higher or top rate, then they can be good. And in those circumstances, I'm a fan of premium bonds for everybody else, I'm not. And the big thing that people say to me and I get this all the time, it always makes me laugh. It's like, yeah, but I win twenty five quid every month. And it's sort of like, yeah, but if we added it up and you put that money in a savings account, you would have a guaranteed winner of forty two pounds every month. So psychologically, they're a brilliant marketing sell and they raised money for the government and they're in NSNI so they're perfectly safe, but the financial services compensation scheme means you're protected up to one hundred twenty thousand pounds per person per financial institution anyway and you can only put fifty thousand in premium bonds. So the prize fund has gone up, many people will be happy more, people will put their money in, but many people are probably worse off having their money in there than they would be elsewhere. And it's only a product that actually makes real sense for you in certain circumstances. We want to cancel tax , a good choice to do this. It rose by an average of four point nine percent for households in England last month. Bill's also on the up in Scotland and Wales. We had the cancel elections last week in many places, which focused a few minds. So let's start with a big one. Check in and challenge your council tax band. You've been doing this one for years . I have indeed. I mean, I think it's one of those ones. It's just so depressing. Everybody knows it's a nonsense the way it was done in the first place . And nobody's got the political will to have a complete to organize it properly because there'd be losers as well as winners and politically it'd be disastrous. In my view, council tax is a broken tax. I mean, let we need to go back and there will be many people here in their thirties who will not remember how this all happened . So we had riots over what was called the community charge but better known as the poll tax, literal riots in the street over this tax . And therefore, the government had to come up within the time, they had to come up with a new form of local taxation to replace it , and they came up with the council tax. And so what they needed to do because the council tax was effectively based on the value of your house , they had to go around and they had to value properties across England, Scotland and Wales. And this was done in nineteen ninety one and without any exaggeration, it was primarily done by what is called second gear valuations. Two people in a car , one driving, the other an estate agent or a quantity surveyor or someone of that ill , who had a list of a few details about each property on a piece of paper in front of them and they went past having a look going Bandsley , Band , Bancy , Bambi . And that's how your council tax ban was originally done. Now in Wales, they have rebanded. This nineteen ninety one valuation andncil Cou tax started in nineteen ninety three was meant to be a stop gap valuation just to set the system up. But everybody knows what I'm about to say that nineteen ninety one stop gap valuation if you are in England or Scotland is the only mainstream valuation we have ever had, unless you got a new built house and in certain circumstances and is still what dictates which council tax band you are in today. Even with all the moves we've had, even with the fact that we knew it was erroneous at the time, and that's why there are an estimated four hundred thousand homes in England and Scotland in the wrong band. Some too high , some too low, and you can , although they don't make it as easy as they should , you can check and challenge your band. Okay, but you have to do it carefully. Emma wants to know how to do that, so go on. So let's do the check first. And the check is pretty simple. And I've got two steps to it and it's very important and I'll explain why there are two steps to it. The challenge is harder . The first check is to find whether you're in a higher band a neighbour in a preferably identical, but if not as similar as you can possibly get property. Now, don't worry you don't need to go next door and knock on and say, what council tax band are you in place? It might not make you popular . You can go onto gov dot UK for England or the Scottish Assessors Association for Scotland, England and Wales gov. UK and you can just look at council tax bans there, both yours and other peoples. So you can have a look and many people have will done this to see what your band and other people's band is. So the first check is the neighbour's check am in a higher band the neighbours in an identical property . But this is really, really important and I've seen some of the questions we've got coming in, which just have misunderstood this point . You are asking for your band to be reviewed . You may be in a higher band than neighbours in a similar identical property because their band is too low, not because your band is too high . And by reviewing it, you could get their band increased, which you do not want to happen. It will not make you popular to have all your neighbour's bands increased. But if we're striving towards fairness , then we should want fairness, shouldn't we? I mean, look, I totally get your point. So let me try ans andwer that in a semi political way . The system is broken . Our political classes have never had the Hutzpa to rework and revalue this system as it desperately needed because it would be incredibly unpopular because there'd be winners and losers, right? I mean, never mind just fixing the system we've got. You could also look at because just remember the band you are in, let's be absolutely plain. When you go and look at this on the chart, the band you are in is literally based on council tax bans from back in nineteen ninety one. You know, a band A property is a property under forty grand in England , under twenty seven grand in Scotland. You can't buy properties at that amount anymore. The top band is over three hundred and twenty grand in England, over two hundred twelve thousand pounds in Scotland. The numbers are different because it's a different world. And it's not just updating what we have, but you could think of a whole different way and whole different forms of banding. And you know, people in very big houses don't pay proportionately that much more. This is why the Chancellor's had to had to chosen to jemmy it with what's going to be called being called the mansion tax is basically a council tax surcharge. So you're right, Adrian. But I'm not sure that that predicates that individuals should go around snooping and trying to get their neighbours band increased. I' means, an that individual's decision if they want to know you're trying to get your own decreased and you might have the effect of getting the others increased, but A would they know it was your fault and B id that implies there are people who this happens and every now and then somebody gets an unwelcome letter from saying, Oh , we're bumping your council bed. And this is why when I invented my check and challenge system back in two thousand seven, although we finesseed it, right? And I did it. It was I always remember doing it. It was because I wrote a little bit about it and I put it in my web forum and I got some responses and people tried it and then I said let me know how your experience is and they came through and then I wrote a guide on it and said test this and then I got loads of feedback and then I did for the guide formally and I did a big tele program by the biggest tele audience I've ever had on television was about six and a half million and was using those research and the reason I came up with the second check is to stop that issue. And the second check is one I called the valuation check. Now it's really important that I say to people that the valuation check is not an evidential check. When you come to challenging your band , they will not take this into account . This second check is one I invented so that you can work out that on the huge likelihood it's you who's in too higher band not your neighbors who are in too lower band. Right? And the valuation check is this , you need to assess your house's value back in nineteen ninety one . It sounds complicated, but effectively, if you bought a house since nineteen ninety one or one of your neighbors has n't identical property since nineteen ninety one, you just need to back calculate it to nineteen ninety one. And you can do that in a complicated way using the house price indices, but there is a free tool available online that will do this for you. I'm just not allowed to tell you where it is. Right. Okay , right. So if then that you've done both checks and both indicate first of all that you're in a hab and the neighbor's in an identical or similar properties and second that on your back calculation you are on the high end of your band or possibly in too high a band , then you should be looking at challenging . But if you only pass the first one and it looks like you're in the right band, you need to be aware you could be dropping your neighbour's council taxpan . Okay , so you challenge it. Inherent in that is that it might end up going up and I've had probably tens of thousands of successes of this reported to be since they launched the system and they still come in regulating. In fact , just by chance, just as I'll do it, when I was coming in this morning, I hope I've got it here. Where was it? I just read it . And via the magic of podcasting and more technically the magic of editing, I now have that case study. Because I haven't asked for their permission to read it out as it was just emailed in to me via website my, I'm going to read it to you anonymously. It said Martin, following your suggestion to check on council tax banding, we submitted evidence over a year ago. Patience paid off because on my husband's birthday, in April this year, we received a nine thousand six hundred pounds as a rebate since we moved into the property in nineteen ninety one and a drop in our council tax band. Thank you for inspiring us to do this. Well, I'm absolutely delighted, anonymous person, that you did that. So the whole point about getting your band lowered is not only is the band itself lowered, but you get a backdated payout going by back to when you moved into the property or nineteen ninety three, whichever is sooner. So if you moved in in nineteen ninety nine, you'll go back to nineteen ninety nine. And that's why this is so important this conversation because this is a substantial amount of money we're talking about for many people who are in the wrong band. I have never had anyone who's used my system tell me that their neighbour's band has gone up. I've heard of it going up but, not people who've done both checks. Okay . So my hope is that that valuation check done properly. But you need to understand and there are people out there who go, oh, it doesn't really show, but I'll try anyway. Well, then that's your risk. Okay, that's your risk. Michelle, we live in a row of fifteen stone cottages. They are grade two listed in a conservation area. All the cottages are council tax b . There's one house in the middle but exactly the same as the others is band A , how can I challenge it? How can I challenge it please? I can't work out that from that whether you're in the band A or you're in the band B . I mean, if you're in the band A then you're on the no see she must be in the band B from the nature of the question because you can't be lower than a band A, so she must be in a band B. Yeah. I mean it sounds to me very likely that the identical house in the middle is in two low a band. I mean that would, be my starting presumption that all the houses in band B are in the right band and the band A is in too lower band. Yeah . So I would be very cautious in this situation , but if you go through this and you find and you do a valuation check and it looks very, very clearly, I would want in that circumstance very robust , deep, clear water between your valuation in nineteen ninety one and a band B valuation, not just at the limit. I'd want you to be way below it, then you could look at doing a challenge. I mean, and I have to say I have had successes over the years of entire streets being revalued. It isn't unheard of. Mines Ih've. been disputing my band with our local council and not getting anywhere. I had a new build from twenty thirteen on a semi detached and the neighbour band , whereas I'm band C . How is this possible? It's a semi detached . Well, it's possible because they valued you differently. So let's just go into how can it make sense how can there be any logic to it? Well, we don't look for logic. We don't look for logic. We look for, I mean , I am presuming anybody doing this has been through my first two checks and has clearly passed the neighbour's check and the valuation check. And if you haven't, you must do that . But on that assumption , you can submit a challenge to your band. Now in England and Wales there is a formal challenge and an informal challenge. In Scotland there is only a formal challenge. For those in Northern Ireland just a there not ise no council tax, which is why I'm not talking about Northern Ireland here. Now the formal challenge very frustratingly can be done by whether you own or rent, but in general terms you must have lived in the property for six months or less if renters are challenging by the way, by courtesy, you should notify your landlord. There are some other reasons you can do a formal challenge, which is a fundamental change in the property, say from house to flats, change in its use, the party's now business, for example, the local areas changed. You've just had an eye club built next door or in Scotland only there's been significant property price drops where you are. So just as an aside , this is one of those life financial management rulings everyone needs to remember. Whenever you move home remember to check your council tax band and do the check and challenge within the first six months because the formal challenge is so much easier than the informal challenge route. So that's my first point . Within the formal challenge, you don't actually need to submit evidence. You do within the informal challenge and there are good guides online of how to do an informal challenge. But the big thing that people in England and Wales can do that you need to know about and this is the Powerhouse improvement that I added to my guide about two years ago is you need to request what is called your pad , your property attribute data , which is held on the gov. UK site. You are absolutely able to go and get it. You go on to it's got a in the box when you go online, it's I think my band is wrong and the text on the next page add I want to request my property attribute data. The online form will ask you a few questions. Now what this is all about is the property attribute data is literally what the valuation office agency who sought council tax knows about your house. It will include its age or period, its type, semi detached end of terrace, its floor area, number of bedrooms, living rooms, bathrooms, number of floors And if you find that the pad is wrong , that is the big light . And we've had quite a lot of people who are in the wrong band have looked at their pad and gone, though that's not correct about my house. And that is very that's the strongest possible evidence. Now , you know, let's be plain here. If you're saying you're in too high a band and it says you've got two bedrooms and you got four bedrooms, that's not the right way around. You know, if it says you've got four bedrooms, you've got two bedrooms, that is the right way around. I mean, let's be sensible about what we're talking. But a crucial stage Minesh, you have to get your pad details and you have to go and check are your pad details correct about the property. And if they are, well, that's very strong. And what you then need to do is you then need to then go and identify neighboring or nearby properties. This is for informal. You don't have to do this in a formal challenge, but I would do it anyway. You then when I say in this step, identify neingighboring or nearby properties, this isn't like you did in the checks. We're now in the challenge phase. This going to take real work . You need to be identifying up to five addresses in the same street or estate, though in the countryside evaluation office agency will consider similar properties with an area as wide as ten miles. They must have the same style or similar features, so semi detached house must be compared with semi detached house. They must be of a similar age, don't compare the new build with a Victorian one. They must be of a similar size comparable properties can be smaller and larger within ten percent . And you're then looking and saying, look at all these details. The details you have on me are wrong. I'm going to give you a comparator to five par isalysis and that why I think I'm in the wrong band . So look, and we need to be honest, we're on the radio here . This is a process and you will be able to find step by step help and templates to do this process online. Really what we're talking about today is the clarion call of what you should or shouldn't be doing, whether this is or isn't right for you. So the next stage to go through is to go and use that the online help that's available to get you through this. Nicola, rechallenging banding in a new build house. In terms of finding similar proper properties , which are the implication being that the new build is different to the surrounding ones, can I use say, a, has built in the nineteen seventies? It feels like new builds get higher banding just because they're new . And when you get the banding notification, there's absolutely no explanation of how it was determined. None of this system is transparent or good. I mean, it shouldn't work this way . And interestingly, one of the things we've talked before in the show, I got the government to change council tax debt collection recently and we'll be talking later about discounts, including severe mental impairment, which we got them to change some rules as well. One of my requests was to get rid of the formal informal rules where you have to do the challenge within six months because I think it's ridiculous because people don't people don't know how it's been going on . They will look at that, but they haven't done it yet. So look, you're right. If you're in a new building and you're the only new build home in your area, it's really going to be very difficult to do this . And I don't think it's fair to say I have no evidence to say that new build homes are valued on too high a band , but clearly new build is a very difficult comparator to an older house if you are the only one . And people won't like me saying this, but there's a bit of shruggish shoulders here. There's a bit of the system's broken, you do what you can do, and if you can't do anymore, you can't do anymore. No, that's it Willow. I need to change my band. I need to change my band. I've no idea where to start finding the price of my property from years ago. Willow situation is they're in a row of terrace houses , which are in Band Bay , and the rest of the very long roads in Banday. Okay , so she's in Banbay. Everyone's in Banday . But if your house has not been bought or sold since nineteen ninety three . Well, then if you're telling me they're all identical properties, one of those houses on those streets will have been bought or sold since nineteen ninety three. You go on to the, you know, the right moves of this world and the property price trackers you can, find what other properties have been bought and sold for. Then you need to convert it back to nineteen ninety one. So you're just looking, find the most if your house is you've been in it a long time , find the most similar house to yours. And in fact, if there are three or four that have sold, get all of the prices, work out what they were worth back in nineteen ninety one, you know, get the prices from the property websites that are free. You can just do it online. It's dead easy. And then convert them all into nineteen ninety two one prices and take an average and see if that works for you. Okay, great . Did you bring your buffter in to show me by the way? I've got a bad shoulder and it's really it's properly really heavy . It weighs about five kilometers. That's the worst injury ever. I've put my shoulder out but it was about carrying all my awards. Oh, I've hurt my shoulder. No, I didn't bring it in, but it was very, very lovely to get it was an incredibly lovely photo of you and Laura felt not tearful exactly, but I had a little catch in my throat when I saw it. Well, I cried during my speech and then they cut to my poor wife who was looking beautiful with you know, crying her eyes out in the mascara running down . But then again, as I've had so many wonderful messages and frank, thank you to everybody who sent me lovely messages, but most people told me they were crying too. So I think maybe we all had a bit of a cry as a nation during the moment. Okay, dust your good every now and then starts to tuck out. Let's just get some instructions from Barbath going out coffee shall we just make it if agents say we forgot what we're doing? What we're doing next and I went we're going to say we're coming back to Council Tax, but we'll do Tellus first So why don't you do that because nobody noticed? The Tellus Tellus is great, go on, tell us about the Tellus The Tellus is in the wrong file. So that's good. What's the biggest biggest money secret you've ever kept? When was it? Who was it? Secret from and why? And why is it okay to tell now? Quite a lot of people say, Well, it's a secret. I'm not telling you, yes. In the question, it said and why is it okay to tell now? So I don't want you to tell your secrets that are secret. I want you to tell you secrets that were secret. So why don't you start? Adrian ? Okay . Do you know what? I've got shall I start? You start? I'll do Ronnie. I've got this is going terribly well. Because I've got last week's Tellus . Yes, so did I. That's yes, that's why it's in the , if you go in there, you send the file below. What's that? Ronnie, had a boss that gave me a fiver every week to take his car to the car wash. I used to take it to my house and wash it in my drive way. That's not a bad little secret. You're still washing the car, you got a fiber for it. That's relatively entrepreneurial. I don't think that one's too bad. Shall I carry on? I've got ones that have just come in actually. Okay . So all the planning and work I do to select a perfect format and mix them up is all going to go to part. You go a bit like that two Ronnie Sketch Red We doing last week's tell us this week answering the question before Where are we? Yes, my wife and I open child trust funds for both of our children. We planned to make sure they both had ten K when they became eighteen, kept it from them till they were fourteen and sixteen. So not letting them know that's there. I think that's a pretty common secret from your children about the money. As an aside, the government is writing to seven hundred and fifty thousand twenty one year olds at the moment to tell them where their child trust funds are. Child trust funds predecessor to the junior ISIA but the state added money. The average amount in them is two thousand pounds, but many have lost track of them. So if you get that letter, it will tell you who your child trust fund provider is and then go directly to that provider, be careful going through anywhere that you're told to because it might be a scam, and then see if you've got the money. But for everyone aged, well, it's around fifteen to around twenty three has money in a child trust fund unless you've accessed it already. Millions of people have lost touch with them. You can go to gov. UK and find where your child trust fund provider is. As I say, the average is two thousand two hundred pounds . Some may have less, some may have more depending on whether money was added to it, whether it was saved or invested. Just on the gov. UK tool. If you're under sixteen, a parent must use the tool. If you're eighteen or over, you must use it yourself. If you're sixteen to eighteen, it can be a parent of parental guardian or the child themselves. Massively important that people aren recectedon with their child trust f unds. Okay , let's I've got another one here. I like this one actually. I won five thousand pounds with Brighton Hove Albion in nineteen ninety two. It was a fighting fund for supporters to keep the club going through tough times. I kept it secret from my m ates until I was called onto the pitcher half time on boxing day to collect my novel my novelty size . She was so outed . Thankfully, none of those problems now with Tony Bloom in charge. So that's a good thing. Phil and my wife passed away on the second of october twenty fifteen. She always put more money away without me knowing. My mum said have your own money. Never told me but ha , our daughter knew. Oh, and then he says, PS miss her. I'm wishing you the best , Phil and it's good you miss her. You love her. Keep her in your heart, mate. Mike, as a teenager , my dad would weakly ask me to put twenty five pounds of Kulni's car, but I always put twenty pounds in and pocketed the five pounds . He even had the car a garage as he was convinced the MPG was so none . He passed twenty plus years ago and I've come to terms with knowing I'm going to hell poor Mike . Joe kept throwing extra money I had at the mortgage and didn't tell him that I'd paid it off, kept it a secret for three months until his birthday, then gave him a card with the letter from the bank in it saying your mortgage is closed . He thought we still owe twenty thousand pounds. He was saying I don't know how you did it. I don't know how you did it. Constantly for the next fortnight. Good secret that one. Good secret. Kirsty bought a beautiful but very expensive olive tree Chelsea at Flower show about ten years ago. My husband still thinks I'm winning a rifle . There's a lot of that goes on. I mean this is all we're doing the nice stuff but actually hidden debts are a really big problem and you need to come clean up your debts. got You' anyve joint problems. It can affect the credit score of the other person as well if you've got any joint accounts together. Rian , when I was eight, I purposefully put twenty one penny sweets in a paper bag at the shop and paid twenty p , Rhiannon. The guilt ate me up so badly that the next day I only put fifteen sweets in the bag and paid them the usual twenty p. I've never forgotten it. I felt like a criminal and couldn't live with myself. far In a similar vein, forty plus years ago, the post office counter assistant overpaid my family allowance by ten pounds . I went back in and said it wasn't right. She pointed to a sign saying Mistakes cannot be rectified when you have left the counter. So I walked away and kept it. Well, that's not a similar vein to me. I think she did everything right, didn't she? The first one, yeah, she stole a sweet, but then she paid back five times its worth. So you know , what do they call it justice? Restorative justice there. That was absolutely fine. Voluntary restorative justice. In this one, I mean they can't have it both ways. They can't say when we underpay you, it's done. You've accepted your money, but we over paid you. You have to give it us back. I think that's absolutely fine. And she was told, she went and did everything she could try. David, I won ten thousand pounds on the lottery and didn't tell anyone for years as I knew they'd all suddenly become friendly. I mean, there must be a figure for the biggest lottery win that somebody's managed to keep completely secret from everyone. Yeah. Why there'd be millions, I would have thought. Yeah. But I mean, how'd you keep millions secret? Just move . Well yeah,, but they'd want but that would reveal you had some money for the move, wouldn't it? Well, yeah, not everyone who wins a lottery doesn't have any money No, no. We're being purely hypothetical here, but I can see a situation where somebody's got says, actually we've decided we're going to emigrate and go to Australia. We love you all you folks and then you know they move from there two hundred up and two hundred down when they get there yeah. Let's do one more. You do Linda. My ninety four year old dad told me recently how his mum, my grandmother purchased a brand new set of sheets . Every time she was short of cash to fund her bingo trips, she'd then get the sheets out still in their packing and tell her husband she'd have to buy new sheets for their home. He then gave her the money for the sheets, which then went back in the company for the next time Grandad never tumbled to her secrets. Tumbledrag to her secrets. Yes, what a sheet trick? Yes, very good. You've got to look, how'd you do these terrible puns and still win a bathtub? I think I think that's what I got them for. No, yeah. Lifetime and your bafta bracket, not for the lifetime achievement for punch. We would have got it three years ago, it had been for the pod.. Thanks Mate Shall we get back to council tax? Because we've done council tax check and challenge. And as I say, if you're looking at that, go and step by step it. But there are lots of discounts and council tax support that people are missing out on as well. Okay, so we should probably show the basics of that . So we'll do council tax discounts now. This does get I'm sorry, this does get a little complicated to explain. I'm going to try and do my best. So So council tax is based on how many people live in the property. So the standard number is two or more. If it's two or more, you pay the full council tax. If it's one, you get the single person discount , which is twenty five percent . But then there are categories of people who are disregarded for council tax. In other words, in a good way, no, that's not a bad way. In a good way you,'re disregarded , you don't count . Therefore , if two adults are living there but one of them doesn't count , then you effectively get the twenty five percent discount. That's the simplest way to explain, although it does get more complic ated, but have that as the big picture starter. So let's go through the different categories of discounted for council tax, not counted as an adult. Someone under age eighteen is pretty obvious . Full time students on a minimum one year course full time is another obvious one. And then the next one is the severe mental impairment discount , which is a severe impairment of int elligence and social functioning which appears to be permanent. Now I hate that term SMI. I actually use say SMI because I don't like saying severe mental impairment. They are changing it as part of the results of some of the things that we've looked at campaigning to a severe cognitive impairment . To get a severe mental impairment massively under communicated, no one near enough people know about this. Common conditions include dementia, Alzheimer's, severe strokes, severe Parkinson's . You have to be medically certified as having an SMI. So a doctor is going to have to certify that you have one and often it'll be your partner or your loved ones who are getting you that certific ation and you need to be receiving a qualifying benefit. Now, interestingly on SMI, not all the qualifying benefits are means tested. Attendance allowances are non means tested benefit for people who need help with living during the day or night . So it is still possible anyone can get an SMI discount even without receiving the qualifying benefit because there are some non means tested benefits in there. So it's not all about the money you have. So those are the three anyway. Under eighteen's, full time students SMI. And I should note another one of the big wins we had recently and I am showing off about it because I've been talking about this for a decade and we've got Wales to do it first. Now England is going to be following suit next April. I've said you to before, this sounds trivial , Adrian , but councils under publicize the SMI and then their forms are all different, which means it's incredibly difficult for someone like me to give guidance of how you fill a form in, right? For many vulnerable people the. go Andvernment from next April has agreed it will have one form and one piece of publication. So wherever you go, it will be a standard format. So me and carers UK and Alzheimer's we can all actually give you nice ED guidance to filling in the form, which can't do it at the moment because every form is different. Not every form is different. Lots of councils have different forms. Then so you've got those three , then you've got live in carers that's someone who is unpaid for caring for over thirty five hours a week and not caring for your spouse partner or a child underage eighteen . So then you are a carer . So let's go through it. If there are two adults qualifying adults living in the property, even if there's also full time students, even if there's also people with SMIs, you pay the full amount. The other people don't matter. You've just got to have two, and if there are two qualified . If there's one adult with an under eighteen or a full time student and or a carer, it's twenty five percent off . If the only people living in the house are someone with an SMI and a carer, which is a common situation, you get fifty percent off. So that's the sort of one that doesn't make sense in a way. And if only discounted people are living together, for example, a household of full time students , you do not pay any council tax. If someone with an SMI is living with an adult, a single adult, you would get twenty five percent off, another common situation. And in some cases, these discounts can be backdated, but it's counseled by council. Something else we've asked them for that they haven't decided yet is standardized backdating rules. Wales has it and Wales backdates since the time you were eligible to claim. Okay, we've had questions on all this, Anna, how about getting the powers that be to give us a single peeps a fifty percent discount off council tax instead of the twenty five percent it's not fair. I'm going to do an explanation on this, not a judgment. Okay . When council tax was first set up, it was meant to be based on the value of the property. The previous local taxation, the community charge was based solely on the number of people in the property . So when they tried to get away from that because of the riots that we talked about earlier, but then there was a lobby that said hold on, this isn't fair. What happens if you've got one person living in a three bedroom property, you know, they're going to be paying the same as six adults sharing that same property. So there was a sop done for that, which was the single person discount the twenty five percent off. Now people always say to me, why isn't it fifty percent off? And then I'm not arguing that it should or shouldn't be. That's a political decision. But I'm not sure why people well, I know why people say fifty percent. They think, well, two adults in a home . Therefore, if there's only one adult, it should be half. But who says there are two adults in a home? Some homes you've got two nineteen year olds living there and two and their parents, that's four adults. You've got a household of young people sharing and there are ten of them, that's ten adults. So the idea that there are two adults living in all homes, therefore, if there's one adult living in a home, you should get a fifty percent discount. That logic doesn't one hundred percent stand up, although I know why people say it. But the answer is, why is it only twenty five percent? Because this was done in nineteen ninety one and hasn't been changed since and the system is bro ken. Pirani, I'm a carer for my father. We live together. He gets his pension attendance allowance and I get carers allowance. Should we be able to get a cancel tax reduction? Well, if there's only the two of you in the house hold, I would think you're entitled to at least the twenty five percent if your father has a severe mental impairment. Now the fact he gets attendance allowance signifies to me there's quite a chance he would be due a severe mental impairment discount. So you tick the getting a qualifying benefit . It is about a doctor certifying that you have let me just check the exact phrasing. It is a severe mental affair ment that affects someone's social functioning , right? So if a doctor will sign that off because just getting attendance allowance doesn't mean you get SMI, you need it to be signed as an SMI, well then you're certainly entitled to a twenty five percent discount and possibly entitled to a fifty percent discount if you're a carer in the right circumstances. Helen says there is a reduction of one band available for people who have to live downstairs in a two story house due to ill health. health. This isn't well publicized. I was coming to it, so I'm delighted to get that question. Basically, if you have disabilities, physical disabilities generally , then and you have to make adaptions to your home because of physical disabilities, you can ask and you have to repeat this every year actually. It's one of the other sort of automatic each year, this one you have to ask every year for a reduction of one band level and it's worth looking at for people in that situation. Okay Claire, are you just what happened there? The desk just lowered. I think you pressed a button to lower the desk. It sort of touched the top of my knee . Unless there's an earthquake . No, I think it was definitely a desk shambles. Claire. That desk doesn't account as adjusting your property by the way that's what you're doing. I mean, lower the desk. Our local authorities are allowed to make it deliberately difficult for you to apply for SMI exemption. I live in Cornw and there's nowhere on their website to make an application for this or if there is, it's very well hidden. Look, I mean, I first launched my severe mental impairment campaign. It was I think it's over a decade ago and we basically the cold called councils to ask about it, and half of the staff back then hadn't heard of the discount . So I think things have improved, but nowhere near enough, which is why we've requested this sort of standardized leaflets, standardized application form that should go on every council and that we're coming in from next April. I mean just to put this in context, this week separately, the carers discount on council tax , we did a spot check of pretty much every council about three months ago and found that if one in five councils in England had incorrect information, misleading information about the council allowance, sixty nine councils. And they were basically missing out. They hadn't updated their doc data until s itince was I think it was about twenty thirteen when the rules changed. So all the list of who could qualify, they were just missing lots of the major categories. They have now on the back of us publicizing it and writing to every council fix that. I say yars, that's my money saving expert team. I mean, I think they deserve the credit for that brilliant kit. Did all the work, well done kit, you're a star on that. And we've got them all to change it. But there's still many people who've gone and read those websites and had correct information. This is commonplace. What I would say is y,es, go ont youro council's websites to look at the discounts, but it is worth looking at other independent sources too, because council websites and council forms not all of them are good enough. Simple as that. So why do the campaigning? Okay, do you want to talk about council tax support? I do. This is so important . Up to two point two five million people on lower incomes are missing out on council tax support worth up to fifteen hundred pounds. This is separate from discounts. Every council runs its own council tax reduction scheme, so what you get depends on where you live. There is no standardized definition and there's no standardized amount that you get reduced. Some councils will cut your bill by up to one hundred percent . It is a jungle of variation, so it really depends on each council. Now, the biggest mistake people make about this is they think if I'm eligible for universal credit , which is the catch all national benefit from then I'll get my council tax support . Uh , they are totally separate systems. You have to apply for council tax support separately. The people who are likely to get it are those people who are on universal credit or pension credit , but you won't get it automatically and that's why so many people miss out. In England and Wales, gov. UK will show you your council's details and then you can then go to it and apply in Scotland my gov dot Scotland . You may be asked to provide evidence. For example, if you've got a low household income, you might need to prove your identity, your rental, your mortgage payments, your income and savings. But I think if you're generally somebody who's on universal credit and on a lower income, you should check out your council's criteria for council tax support. I mean, two and a quarter million people are likely it's impossible to say it 's cancelled by council missing out on that. And it can be big money. Okay, we got time for a question. Let's do that. Go very quickly. My daughter and I both blow income and get universal credit. I've asked my local cancer if we're entitled to a discount but not heard back. What should I do? Get in touch with them and persevere. I'll do a couple more questions on that because I know we've got more of that when we do the podcomy, but we should probably play this right now. Adrian, you got it wrong last week, which means the score stands that you've got nineteen right and thirty eight wrong in this three option multiple choice quiz, which I means I'm afraid you're back to B R C . No better than random chance, but let's get on with it . Now everybody, our Adrian was stopped in the street by a very attractive woman. She said to him , You're Adrian Chiles, aren't you? For one glorious moment, he thinks this is how James Bond must feel. He lifts an eyebrow and says in his smoothest west midland spy voice, yes , the name's Chiles , Adrian Chiles. Could you just do that for us ? The name's Chiles, Adrian Chiles. Marvellous . I thought so. She says . You do that podcast with Martin, don't you? Can you ask him something? I've been saving into a Lysa, but I've just inherited some money. I want to buy a house. I don't need a mortgage anymore. Can I still use my LISA? , says Adrian, slightly deflated, but styling it out You don't need Martin Lewis. I'm here. So Adrian, what we want to know is what did you answer and we want the correct answer at all ? She wants to use her lifetime ISA she's been saving to as a first time buyer, which you get a twenty five percent bonus on buying a qualifying property under four hundred fifty thousand pounds without a mortgage. Is it a no, you can't do it without paying the withdrawal penalty , B, yes, but you won't get the twenty five percent bonus. C, yes, and you can get the twenty five percent bonus . Do you understand the question? Yes, I do. Have you given me all available information . So necessary information the question is she wants to buy a first time property using a lifetime ISIL but she doesn't need a mortgage. She's just going to buy it outright. Can she get the twenty five percent bonus that's been added to a lifetime I CE and use it towards a mortgage. So A , no should have to pay a withdrawal penalty which would take that bonus off effectively. Okay, but she doesn't need a mortgage. She doesn't, and she's not getting a mortgage. And this is a first property. First property. And the property is worth how much? Under four hundred fifty thousand . So it's worth four hundred twelve thousand, seven hundred and thirteen pounds and twelve pence. Under four hundred fifty thousand. So it qualifies in every other way. The question is, does the fact she's not getting a mortgage inval idate it? So a no, B yeah, she won't get the twenty five percent bonus but she'll get her money back. C ause remember the withdrawal penalty means you get back less than you put in. Basically you get back what she put in or C she will get the bonus . Well, obviously, as usual, I haven't been concentrating hard enough. We haven't talked about this in the pregnancy before. No, I know we have, but I don't remember the mortgage, why would the mortgage be here or here or there on this because it's to help you get the mortgage. I would hope logic would say it's C , I think it's B. So you're going to say yes, but she just won't get the twenty five percent bonus. Yeah . Well, it's not B , you've locked in. Right. So let's have an error straight away because we're rubbing. And I'm afraid she won't get the bonus at all . The answer here is the lifetime ICE to get it , you have to be doing it when you are getting a mortgage on a property. And I presume the original reason you just get a five grand mortgage though. Well, it's quite difficult to get a five grand mortgage. That's what you have to do. You would have to go and mortgage a part of the property in order to get the bonus, whether that's worth it or not for you depends on the terms of the mortgage. But if you'd saved a lot in a life, if you'd been maxing it out and had sort of six or seven grand worth of free money, it could well be worth getting a mortgage. I'm not sure you're going to get one for five grand though. You're going to need to get one for bigger than that and it's going to be a hassle. But the rules are effectively because the lifetime ICE was brought in to help those people get on the housing ladder who couldn't afford to. Clearly if you don't need a mortgage and you've got the cash you can afford to and, therefore it wasn't set up to be able to help you. So lifetime icers do require you to get a mortgage for you to be able to use them. So hands up. When I was having a quick listen to the podcast to review it afterwards, I listened to my answer and didn't think I was glare en ough, so I just wanted to add a couple of notes here. The correct answer in Money Mastermind was answer A, you'd pair withdrawal penalty. And this is really important . The rules on licenses are plain. You only get the twenty five percent bonus if you're buying a qualifying property under qualifying rules , which means you have a non buy to let mortgage for a UK residential property that costs under four hundred fifty thousand pounds , or you take the money out once you're age over sixty . If you take money out for any other reason , you would have to pay withdrawal penalty. Now the withdrawal penalty is twenty five percent and this can get a little confusing . The bonus is twenty five percent and that is automatically added each month and the withdrawal penalty is twenty five percent , which some people wrongly assume means you get back what you put in. Unfortunately, the maths doesn't work like that because if you have say ten thousand pounds and you get a twenty five percent bonus, you've now got twelve thousand five hundred pounds. If you have a twenty five percent penalty on that, that's twenty five percent off a bigger number because twelve thousand five hundred is bigger than ten thousand . And the net result is you're actually six point two five percent down. So you would only withdraw nine thousand three hundred and seventy five pounds . Therefore, in the case of someone not needing a mortgage, their only choice if they want to keep the money is either get a mortgage, as Adrian suggested , or wait until age sixty. If they just want to take the money out, they would pay a penalty on it. Now that's not the most common scenario. The most common scenario and the biggest problem with the lifetime ICE is for those people who've been saving up to buy a home and then the home that they're buying costs a little bit over four hundred fifty thousand pounds. And then even though they have done everything right, they've got a mortgage, they've saved up for a property using a lifetime Ice of their first time buyers , they still, if they want to take their money out which, they probably will because they've been using it as their place to save for third time property, have to pay that six point two five percent penalty. I hope that clears it up. Hello now and welcome to the pod only bit. I'm here with PPS podcast producer Simon. Hello, Simon, how you doing? I am excellent . I would like because of my slight pun disease , I would just like a little bit of credit that we've been talking about being in the wrong band the whole time and I haven't mentioned Robbie, I haven't mentioned Jerry, I haven't mentioned Zane. I did not do that pun at any point and I think I should be somewhat credited for my fantastic restraint over that. Admirable. Yes. Admirable But we do have some more council tax questions and stuff to talk about, so we'll move away from the puns and get straight into them. I think there was one more we had left on council tax support. Yeah, a really interesting one actually from Dariel . Any idea what's happening with people who were bumped over to Universal Credit from legacy benefits like ESA and then found the transitional protection didn't include council tax support. Mine went up twenty five percent . Yeah, this is really interesting question. So for those who don't know, if you were on the old form of benefits like tax credits or others, you were moved over an income support and etc . You were moved over to universal credit and if you agree to do it in the right way then you got transitional protection which said for a limited time your income would not drop. So you would get the same amount of income even if you're going to a new system where ultimate ly you would be getting less on universal credit . But there was an interaction of that with the way that council support works in some councils. Remembering every council is doing this differently, both its eligibility criteria, what it counts as income and what it is paying out . So what is likely to have happened here is that even though transitional protection meant that you got the same total income under the new system with universal credit as you did under the legacy benefit system , because what's likely to have happened is you then got a lower universal credit payment plus a top up income in the form of a transitional payment , the council counts those incomes differently to the way it did before when it would only count a certain amount of universal credit up. And with that just going, it gets incredibly complicated, but basically that meant that the council said you didn't weren't entitled to the same support. I mean, it's crackers, but that's just how it works. I don't know what to say. I mean, these things , I think I've made my frustration with the Council tax system pretty plain. I mean, again, the fact that Council tax support is varied so widely in every council and is a postcode lottery is another part of this broken system What else have we got, Simon? Well, so I think you said we're going to do five council tax savings, but we've only actually done three so far. That's a very good point. I do have two left. Don't worry, I was not getting my numbers wrong. So I'll just look quick ones I'll add in now. We haven't had any questions on them because they tend not to be things that people know about. From Freedom of Information Request, the last one I did was in twenty twenty four on this . Local authorities across Britain were sitting on one hundred and forty million pounds of overpaid council tax. Now you're most likely to be able to claim if you've moved out of the council area since nineteen ninety three it goes back all that time and you weren't paying by direct debit. Effectively, it means that you're entitled to a refund back but you never got your refund and there's one hundred forty million pounds of it. So the first option is check if your old counsel offers an easy online claim form. This is the best way just do a search for council name, whatever your council name is counsel tax refund firm. About half the time this will take you to an online claims firm and a page explaining your council's process. If not, you can email your coun orc callil them, but generally emails better. If you don't have enough details if the form is off putting long, you can try and check just to see. So again , if you moved out of your council area, so you moved to a different council area and you weren't paying by direct debit and you move sort of midway between your payment year, you may be owed some money back. And that's all you're looking to check and do. So that's a simple one. And then my final one , which is probably a cheat in my five ways to save on council tax just it's that we talked about this before, but it was worth putting in and because I'm very pleased about it, English council tax is changing from next April. We've already mentioned the severe cognitive impairment change for SMI . The other big change is about the process on the Council tax debt collection, which you will have heard if your regular listeners me talk about many times before as being the most aggressive, punitive, vicious and counterproductive form of mainstream debt collection. Councils are allowed to do things that no commercial company would be allowed to do that would fail in the FCA's treatment of how consumers should be treated if a commercial lender were doing it. And we have managed to mitigate that somewhat. This is a campaign I did with my Money and Mental Health Policy Institute Charity. I did it first by meeting Angela Rayna, who I have to tell you. I have loads of these meetings and normally what you get from a politician is a nod and a smile. But what she said at the end is, yeah, we should sought that. And I thought, well, we'll see if you do. But then they put out a consultation pretty quickly and Steve Reed, her successor has followed that up. So thanks to him as well for listening here. There's no party political point just in case this is a podcast that's going out. I know we're in the middle of this of this political turmoil with lots of different names being mentioned. I am staying strictly neutral, I'm just telling a story of something that happened in the past. So anyway, those changes are now confirmed to come in from april twenty twenty seven. And here is what's happening. Currently if you miss your monthly payment on council tax . Within just three weeks you can be asked to pay for the entire year . As I've said before, no idea how people who miss a monthly payment are expected to be able to afford to pay for an entire year's payment. And within three weeks of that , the council can apply to court and send bailiffs in and add administrative costs on top . So the big changes here are first of all instead of three weeks in which after three weeks they can change from a month to a year, they will have to wait sixty three days, which is roughly the same amount of time as breathing space and debt collection. They should also be signposting you to where you can go and get money help. And hopefully that will give you a little bit of time a to go and talk to get help and to sort out how to pay the council tax so you don't progress to that bailift stage. And if you do go to the bailif stage, there will be a limit on the extra cost that can be added on top of a hundred quid. Now, look, I need to be honest with you. I would have liked that delay to be a lot longer. I would have liked the hundred quid to be a lot shorter, but this is still a big improvement. Final note of a change that's going to be coming from next year in council tax as we're talking all things council tax is that currently the default on most councils in England anyway is asking for payments from April to January ten monthly payments, though you do have a right to ask for it to be done in twelve monthly payments. From april twenty twenty seven for new bills and for the following year for all bills, the default will be shifted to twelve monthly council tax payments. It won't change what you pay. It just changes how you pay, which makes more sense twelve monthly. But one of the things I lobbied on there is you should still have the right to be able to request for ten monthly payments. Stick on the current system because I know some people like that because they say to me, yeah, but then I use those extra two months to pay for my car insurance. So it's a good way. It helps me budget. So you will still be able to do that. So those are my final fifth way to save on council tax was a little bit of a cheat but I wanted to talk to you all about it anyway and I think that's probably enough. I think Steiner shall we stop there? Oh, you've nailed it. Yeah, done. So as we've just said, that is it for this week. We tend to put out a new episode every Thursday and Monday. The Monday one is the question Tim peodcast where, you can ask me absolutely anything and everything open brackets within reason closed brackets. If you've enjoyed today's pod, please subscribe, and why not tell your friends you've been listening to the Martin Lewis podcast? After all, they might listen, they might realize they're in the wrong council tax band, they might get back six or seven grand. Surely then they owe you at least a drink. You never know. After all, think about the rewards and joy you could get from saving your friends money. And if you haven't enjoyed it, but for some reason you have been listening all this way through into the podcast just I got milled , I got paid . So I'm gonna work for . I got a feed back fees on the lenshone Martin Lewis is the founder of money saving expert. com , but of course, other consumer and price comparison websites are available. You can get in touch with Martin's podcast production team by emailing Martin Lewis podcast at bc. co. uk. The offers and rates mentioned in the podcast are correct at the time of recording, however, if you are listening on demand, it's worth double checking as details can date. Remember to subscribe on BBC Sounds and leave us a review however you listen