Where a person is deemed to be ‘Severely Mentally Impaired’ for Council Tax purposes then they may, where they meet the relevant criteria, be disregarded for the purposes of paying Council Tax. In some cases the property may become exempt form Council Tax.
We will consider this position in more depth below.
Legislation – Schedule 1 (2) of the Local Government Finance Act 1992
The definition of Severe Mental Impairment is defined under Schedule 1 (2) of the Local Government Finance Act 1992. This act, which lays out the basic framework of Council Tax, states that
The severely mentally impaired
2(1)A person shall be disregarded for the purposes of discount on a particular day if—
(a)on the day he is severely mentally impaired;
(b)as regards any period which includes the day he is stated in a certificate of a registered medical practitioner to have been or to be likely to be severely mentally impaired; and
(c)as regards the day he fulfils such conditions as may be prescribed by order made by the Secretary of State.
(2)For the purposes of this paragraph a person is severely mentally impaired if he has a severe impairment of intelligence and social functioning (however caused) which appears to be permanent.
(3)The Secretary of State may by order substitute another definition for the definition in sub-paragraph (2) above as for the time being effective for the purposes of this paragraph.
The 3 conditions, a – c, listed above under Section 2(1) of the Schedule, must be met to be disregarded. See below for further information regarding the condition required under Section 2(1c). (The definition of ‘Severely Mentally Impaired’ is given by Section 2(2)).
Conditions prescribed by the Secretary of State
Under Section 2(1c) of the Schedule given above the Secretary of State made an order that a third condition was to be required, in addition to those two conditions given under Section 2(1a) & 2(1b) of the Schedule.
This additional condition is laid out in the Council Tax (discount disregards) order 1992, as amended. Section 3(1) of the order states that “The condition prescribed for the purposes of paragraph 2(1)(c) of Schedule 1 to the Act is that the person in question is entitled to one of the qualifying benefits…“.
Note that a key aspect of this condition is that a person needs to be entitled to a qualifying benefit, not that they have to be in receipt of the qualifying benefit. This means a person doesn’t need to be actually receiving the benefit providing they can show they would be entitled to the benefit.
A list of the qualifying benefits (as of December 2016) is given below:
- Incapacity Benefit.
- Attendance Allowance.
- Severe Disablement Allowance.
- The Care Component of a Disability Living Allowance, payable at the middle or highest rate .
- An increase in the rate of Disablement Pension, where constant attendance is needed.
- Disability element of Working Tax Credit.
- Unemployability Supplement.
- Constant Attendance under a industrial injuries or war pension scheme.
- Unemployability Allowance under a industrial injuries or war pension scheme.
- Income Support where the applicable amount includes a disability premium.
- Incapacity Benefit.
- The standard or enhanced rate of the daily living component of Personal Independence Payment.
- Employment Support Allowance (Income Related or Contributory).
- Armed Forces independence payment.
Do I have to have a specified illness to be severely mentally impaired ?
No, the regulations do not specify any particular illness to qualify (although some websites do wrongly suggest otherwise). Providing your Doctor believes you meet the definition of “severe impairment of intelligence and social functioning (however caused) which appears to be permanent” then the particular illness is sufficient.
Can I be Severely Mentally Impaired and not eligible to be disregarded.
Yes – even if you meet the definition of having a “severe impairment of intelligence and social functioning (however caused) which appears to be permanent” you must also meet the other criteria given above before any Council Tax reduction can be considered.
What happens if I’m disregarded and I’m liable for the Council Tax ?
It depends whether you’re solely liable for the Council Tax on the property or not :
- If you are the sole adult occupier and liable person you will remain liable for Council Tax purposes however the property may then be exempt.
- If you are the sole liable person but there are other adults resident you will remain liable for Council Tax purposes. The value of any reduction would depend on the Council Tax status of the other adult occupiers.
- If you are a joint liable person then in most cases the other liable parties will become liable and responsible for paying the Council Tax. The value of any reduction would depend on the Council Tax status of the other adult occupiers.
How much reduction would I get ?
If all of the adult occupiers of the property are disregarded as ‘Severely Mentally Impaired’ then a property is exempt from Council Tax as per the Council Tax (exempt dwellings) order 1992, as amended. This is called a Class U Council Tax exemption.
If all of the adult occupiers of the property are not disregarded as ‘Severely Mentally Impaired’ then the amount of reduction can vary from 0% to 100% depending on the status of the other occupiers.
Are there any other reductions I can claim ?
It is always worth considering if you may be entitled to claim Council Tax Reduction (formerly Council Tax Benefit). Each local authority scheme is slightly different and so application needs to be made to them to see if you qualify.
A request may also be made for a discretionary reduction in Council Tax by way of Section 13A of the Local Government Finance Act 1992.
Backdating of reductions
There is nothing in Council Tax legislation which prevent backdating as far back in time as the eligibility criteria for the reduction are met. In some cases however a Local Authority may attempt to limit the backdating.
Disputes regarding entitlement would fall under the remit of a Valuation Tribunal.
Assistance from LGFA92
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This article is solely the view of LGFA92, the Council Tax experts, based on our interpretation of legislation. Your local authority is free to dispute this view. A binding decision may require the intervention of a valuation tribunal.