How your parish precept is calculated
The Local Government Finance Act 1992 states that precepts may be set by parishes and towns to meet their annual budget requirements, this figure is to be issues to be the billing authority to set council tax each year.
The parish request a monetary amount e.g., £10,000 and the charge to the council tax payer is calculated using the tax baser for that parish. The statutory day for calculating the taxbase is 30 November.
The tax base is made up of the number of households within the district less adjustments for properties in receipt of exemptions (e.g., properties solely occupied by people with severe mental impairment or full-time students) and discounts such as single occupancy and carers discount.
Properties that have been adapted to meet the needs of a disabled resident are charged at a band lower than stated in the valuation list, so for example, a property that has been adapted which is has an official council tax band of D, would be charged the annual amount set for a Band C property.
Council Tax Reduction replaced Council Tax Benefit in 2013 and is a localised scheme approved by each Council. The scheme is based on family income/circumstances and any reduction is applied directly to the bill.
The number of households in receipt of Council Tax Reduction, discount, exemption, or disabled band relief within a parish will reduce the number of equivalent Band D figure used to calculate the precept.
Where a property has been unoccupied and unfurnished for over two years, the billing authority may apply an empty property premium, this will result in the charge increasing by 100%, 200% or 300% depending on the length of time the property has remained unoccupied.
The tax base also includes a prediction in respect of new build properties that may complete within the year, this is based on local knowledge and the value of comparable properties within the area.
Finally, an allowance for non-collection of in-year council tax is deducted from the figure (usually around 2%).
Once the information has been collected and the above factors have been considered, the taxbase will provide the final number of equivalent band D properties for each parish.
For the purpose of council tax, each domestic property is placed in a valuation band from A-H. A calculation is then carried out based on the charge for a band D property. For example, a band H property would be charged twice the amount of a band D property – 18/9.
Change to council taxpayers is precept divided by tax base:
e.g., parish asks for £10,000 and the final tax base calculation is 125.6 band D equivalents.
A band D property would pay (10,000/125.6) = £79.62
Band H is £159.24 (18/9 of £79.62) = £79.62
Why does my parish precept change each year?
Even if the parish keeps their precept request the same, the amount shown on your bill may change.
This is due to the number of properties within the parish that are in receipt of one of the above reductions, charged an additional premium, or the number of new build properties that are predicted to complete as at the 30 November, and the overall effect that has on the final equivalent band D properties within the parish.
Example – precept kept same for two years, however an increase in the properties receiving a Council Tax Reduction, discount or exemption reduces the tax base calculations.
|Parish precept requirement||£10,000||£10,000|
|Divide by the tax base||123.6||115.9|
|Band D council tax charge||£80.91||£86.28|
As you can see the charge to the tax payer has increased but the parish are not receiving any additional funds.