Below are 3 examples of how the proposed council tax tolerance rule is applied based on an ‘assumed tolerance level’ of plus/minus £65 per month.
Key terms:
UC: Universal Credit
CTR: Council Tax reduction
Example 1
Month: May 2025
UC amount: £1000
CTR Award: £40.00
Basis of the award: Initial award of £40 CTR based on a £1000 UC award
Month: June 2025
UC amount: £1050
CTR award: £40.00
Basis of the award: UC award increases to £1050 but CTR award does not change as UC has only increased by £50, which is within £65 tolerance level. UC amount stays as £1000 on the CTR claim.
Month: July 2025
UC amount: £1100
CTR amount: £35
Basis of the award: UC award increases to £1100. As the UC amount has increased from £1000 to £1100, this is over the tolerance level and the CTR claim is reassessed and the CTR award reduces. The UC amount changes to £1100 on the CTR claim.
Month: August 2025
UC amount: £1150
CTR award: £35.00
Basis of the award: UC award increases to £1150. As the UC amount has increased from £1100 to £1150, this is under the tolerance level so the CTR claim is not reassessed and the CTR award stays at £35. The UC amount remains at £1100 on the CTR claim.
Month: September 2025
UC amount: £1000
CTR award: £40.00
Basis of award: UC award decreases to £1000. As the UC amount on the CTR claim has decreased from £1100 to £1000, this is over the tolerance level so the CTR claim is reassessed and the CTR award increases to £40. The UC amount on the claim reduces to £1000.
Month: October 2025
UC amount: £900
CTR award: £45.00
Basis of the award UC award decreases to £900. As the UC amount has decreased from £1000 to £900, this is over the tolerance level so the CTR claim is reassessed and the CTR award increases to £45. The UC amount on the claim reduces to £900.
Example 2
Month: May 2025
UC amount: £1000
CTR award: £30.00
Basis of the award: Initial award of £30 CTR based on a £1000 UC award.
Month: June 2025
UC amount: £900
CTR award: £40.00
Basis of the award: UC award decreases to £900. As the UC amount has decreased from £1000 to £900, this is over the tolerance level so the CTR award is reassessed and the CTR award increases to £40. The UC amount changes from £1000 to £900 on the CTR claim.
Month: July 2025
UC amount: £1100
CTR award: £25.00
Basis of the award: UC award increases to £1100. As the UC amount has increased from £900 to £1100, this is over the tolerance level and the CTR claim is reassessed and the CTR award reduces. The UC amount changes to £1100 on the CTR claim.
Month: August 2025
UC amount: £1150
CTR award: £25.00
Basis of the award: UC award increases to £1150. As the UC amount has increased from £1100 to £1150, this is under the tolerance level so the CTR claim is not reassessed and the CTR award stays at £25. The UC amount remains at £1100 on the CTR claim.
Month: September 2025
UC amount: £900
CTR award: £40.00
Basis of the award: UC award decreases to £900. As the UC amount on the CTR claim has decreased from £1100 to £900, this is over the tolerance level so the CTR claim is reassessed and the CTR award increases to £40. The UC amount on the claim reduces to £900.
Month: October 2025
UC award: £900
CTR award: £40.00
Basis of the award: UC award stays at £900. As the UC amount has not changed the CTR claim is not reassessed and the CTR award stays at £40. The UC amount on the claim remains at £900.
Example 3
Month: May 2025
UC amount: £1200
CTR award: £40.00
Basis of the award: Initial award of £40 CTR based on a £1200 UC award.
Month: June 2025
UC amount: £1000
CTR award: £45.00
Basis of the award: UC award decreases to £1000. As the UC amount has decreased from £1200 to £1000, this is over the tolerance level so the CTR award is reassessed and the CTR award increases to £45. The UC amount changes from £1200 to £1000 on the CTR claim.
Month: July 2025
UC amount: £1100
CTR award: £40.00
Basis of the award: UC award increases to £1100. As the UC amount has increased from £1000 to £1100, this is over the tolerance level and the CTR claim is reassessed and the CTR award reduces. The UC amount changes to £1100 on the CTR claim.
Month: August 2025
UC amount: £1150
CTRE award: £40.00
Basis of the award: UC award increases to £1150. As the UC amount has increased from £1100 to £1150, this is under the tolerance level so the CTR claim is not reassessed and the CTR award stays at £40. The UC amount remains at £1100 on the CTR claim.
Month: September 2025
UC amount: £1000
CTR award: £45.00
Basis of the award: UC award decreases to £1000. As the UC amount on the CTR claim has decreased from £1100 to £1000, this is over the tolerance level so the CTR claim is reassessed and the CTR award increases to £45. The UC amount on the claim reduces to £1000.
Month: October 2025
UC amount: £950
CTR award: £45.00
Basis of the award: UC award decreases to £950. As the UC amount has decreased from £1000 to £950, this is under the tolerance level so the CTR claim is not reassessed and the CTR award stays at £45. The UC amount remains at £1000 on the CTR claim.
