C28C29C30C36C35 Part I Council Tax: England and Wales
Pt. I (ss. 1-69) modified (31.3.1992) by S.I. 1992/549, art.3.
Pt. I (ss. 1-69) modified (31.3.1992) by S.I. 1992/550, arts. 3, 4
Pt. I (ss. 1-69) modified (28.11.1994) by S.I. 1994/2825, reg. 3
Pt. 1 modified (24.12.2008) by The Local Government (Structural Changes) (Finance) Regulations 2008 (S.I. 2008/3022), regs. 1(2), 8
Pt. 1 modified (24.12.2008) by The Local Government (Structural Changes) (Finance) Regulations 2008 (S.I. 2008/3022), regs. 1(2), 7
C27C51C52C53 Chapter IV Precepts
Pt. I Chs. III-IV (ss. 30-52) modified (E.) (1.2.1993) by S.I. 1993/22, art. 4(2)
Pt. I Ch. IV amended (28.11.1994) by S.I. 1994/2825, reg. 49
Pt. I Ch. IV (ss. 39-52) excluded (1.8.1996) by S.I. 1996/1748, reg. 6(2)
Pt. I Ch. IV (ss. 39-52) restricted (12.7.1995) by S.I. 1995/1771, art. 4(3)(b)(i)
Pt. I Ch. IV (ss. 39-52) restricted (12.7.1995) by S.I. 1995/1772, art. 4(3)(b)(i)
Pt. I Ch. IV (ss. 39-52) restricted (12.7.1995) by S.I. 1995/1773, art. 4(3)(b)(i)
Pt. I Ch. IV (ss. 39-52) restricted (12.7.1995) by S.I. 1995/1774, art. 4(3)(b)(i)
Pt. 1 Chs. 4, 4ZA: power to modify conferred by 2009 c. 20, s. 107G(3) (as inserted (E.W.) (28.1.2016 for specified purposes, 28.3.2016 in so far as not already in force) by Cities and Local Government Devolution Act 2016 (c. 1), ss. 5(3), 25(2))
Pt. 1 Chs. 4, 4ZA applied (with modifications) (27.4.2017) by The Combined Authorities (Finance) Order 2017 (S.I. 2017/611), arts. 1, 4(1)(2)(a), Sch.
Pt. 1 Ch. 4: power to amend conferred (26.12.2023) by Levelling-up and Regeneration Act 2023 (c. 55), ss. 41(3), 255(2)(c) (with s. 247)
Calculations by major precepting authorities
42AF55Calculation of council tax requirement by authorities in England
1
In relation to each financial year a major precepting authority in England must make the calculations required by this section.
2
The authority must calculate the aggregate of—
a
the expenditure the authority estimates it will incur in the year in performing its functions and will charge to a revenue account for the year in accordance with proper practices,
b
such allowance as the authority estimates will be appropriate for contingencies in relation to amounts to be charged or credited to a revenue account for the year in accordance with proper practices,
c
the financial reserves which the authority estimates it will be appropriate to raise in the year for meeting its estimated future expenditure, and
d
such financial reserves as are sufficient to meet so much of the amount estimated by the authority to be a revenue account deficit for any earlier financial year as has not already been provided for.
3
The authority must calculate the aggregate of—
a
the income which it estimates will accrue to it in the year and which it will credit to a revenue account for the year in accordance with proper practices, other than income which it estimates will accrue to it in respect of any precept issued by it, and
b
the amount of the financial reserves which the authority estimates that it will use in order to provide for the items mentioned in paragraphs (a) and (b) of subsection (2) above.
4
If the aggregate calculated under subsection (2) above exceeds that calculated under subsection (3) above, the authority must calculate the amount equal to the difference; and the amount so calculated is to be its council tax requirement for the year.
5
In making the calculation under subsection (2) above the authority must ignore payments which must be met from a trust fund.
6
In estimating under subsection (2)(a) above an authority must take into account—
a
the amount of any expenditure which it estimates it will incur in the year in making any repayments of grants or other sums paid to it by the Secretary of State, and
b
in the case of an authority which is a county council, the amount of any levy issued to it for the year.
7
But (except as provided by regulations under section 74 of the 1988 Act) the authority must not anticipate a levy not issued.
F667A
In estimating under subsection (2)(a) above an authority must take into account the amount of expenditure which it estimates it will incur in the year in accordance with regulations under section 99(3) of the 1988 Act.
8
For the purposes of subsection (2)(c) above an authority's estimated future expenditure is—
a
that which the authority estimates it will incur in the financial year following the year in question, will charge to a revenue account for the year in accordance with proper practices and will have to defray in the year before the following sums are sufficiently available—
i
sums which will be payable to it for the year, and
ii
sums in respect of which amounts will be credited to a revenue account for the year in accordance with proper practices, and
b
that which the authority estimates it will incur in the financial year referred to in paragraph (a) above or any subsequent financial year in performing its functions and which will be charged to a revenue account for that or any other year in accordance with proper practices.
9
In making the calculation under subsection (3) above the authority must ignore payments which must be made into a trust fund.
10
In estimating under subsection (3)(a) above the authority must take into account the sums which the authority estimates will be paid to it in the year by billing authorities in accordance with regulations under section 99(3) of the 1988 Act.
11
The Secretary of State may by regulations do one or both of the following—
a
alter the constituents of any calculation to be made under subsection (2) or (3) above (whether by adding, deleting or amending items);
b
alter the rules governing the making of any calculation under subsection (2) or (3) above (whether by deleting or amending subsections (5) to (10) above, or any of them, or by adding other provisions, or by a combination of those methods).
12
This section is subject to section 52ZT below (which requires a direction to a major precepting authority that the referendum provisions in Chapter 4ZA are not to apply to the authority for a financial year to state the amount of the authority's council tax requirement for the year).
42BCalculation of basic amount of tax by authorities in England
1
In relation to each financial year a major precepting authority in England must calculate the basic amount of its council tax by applying the formula—
where—
R is the amount calculated (or last calculated) by the authority under section 42A(4) above as its council tax requirement for the year;
T is the aggregate of the amounts which are calculated by the billing authorities to which the authority issues precepts (“the billing authorities concerned”) as their council tax bases for the year for their areas, or (as the case may require) for the parts of their areas falling within the authority's area, and are notified by them to the authority within the prescribed period.
2
Where the aggregate calculated (or last calculated) by the authority for the year under subsection (2) of section 42A above does not exceed that so calculated under subsection (3) of that section, the amount for item R in subsection (1) above is to be nil.
3
The Secretary of State must make regulations containing rules for making for any year the calculation required by item T in subsection (1) above; and the billing authorities concerned must make the calculations for any year in accordance with the rules for the time being effective (as regards the year) under the regulations.
4
Regulations prescribing a period for the purposes of item T in subsection (1) above may provide that, in any case where a billing authority fails to notify its calculation to the precepting authority concerned within that period, that item must be determined in the prescribed manner by such authority or authorities as may be prescribed.
5
The Secretary of State may by regulations do either or both of the following—
a
alter the constituents of any calculation to be made under subsection (1) above (whether by adding, deleting or amending items);
b
provide for rules governing the making of any calculation under that subsection (whether by adding provisions to, or deleting or amending provisions of, this section, or by a combination of those methods).
C1C2C3C4C5C6C7C8C31C33C37C39C41C43C45C47C4943 Calculation of budget requirement F56by authorities in Wales.
1
In relation to each financial year a major precepting authority F32 in Wales shall make the calculations required by this section.
C92
The authority must calculate the aggregate of—
C10a
the expenditure the authority estimates it will incur in the year in performing its functions and will charge to a revenue account for the year F33...;
F60aa
the expenditure that the authority estimates it will incur in the year in making repayments of—
i
grant paid to it by the Secretary of State or the Welsh Ministers, or
ii
amounts paid to it by the Welsh Ministers in respect of redistributed non-domestic rates;
b
such allowance as the authority estimates will be appropriate for contingencies in relation to expenditure to be charged to a revenue account for the year;
c
the financial reserves which the authority estimates it will be appropriate to raise in the year for meeting its estimated future expenditure; and
d
such financial reserves as are sufficient to meet so much of the amount estimated by the authority to be a revenue account deficit for any earlier financial year as has not already been provided for.
3
The authority must calculate the aggregate of—
a
the sums which it estimates will be payable to it for the year and in respect of which amounts will be credited to a revenue account for the year, other than sums which it estimates will be so payable
F62aa
the sums that it estimates will be payable to it for an earlier financial year in respect of—
i
redistributed non-domestic rates,
ii
revenue support grant,
iii
additional grant,
iv
floor funding, or
v
police grant;
ii
in respect of any precept issued by it; F58...
b
the amount of the financial reserves which the authority estimates that it will use in order to provide for the items mentioned in paragraphs (a) and (b) of subsection (2) above.
4
If the aggregate calculated under subsection (2) above exceeds that calculated under subsection (3) above, the authority must calculate the amount equal to the difference; and the amount so calculated shall be its budget requirement for the year.
F295
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
F25A
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
6
For the purposes of subsection (2)(c) above an authority’s estimated future expenditure is—
a
that which the authority estimates it will incur in the financial year following the year in question, will charge to a revenue account for the year and will have to defray in the year before the following sums are sufficiently available, namely, sums—
i
which will be payable to it for the year; and
ii
in respect of which amounts will be credited to a revenue account for the year; and
b
that which the authority estimates it will incur in the financial year referred to in paragraph (a) above or any subsequent financial year in performing its functions and which will be charged to a revenue account for that or any other year.
C13F266A
In this section and section 44 below “police grant”, in relation to a major precepting authority and a financial year, means the total amount of grant payable to the authority in accordance with the police grant report for that year.
6B
In subsection (6A) above “police grant report” means a police grant report approved by a resolution of the House of Commons pursuant to section 46 of the Police Act 1996.
F636C
In this section and section 44—
a
references to sums payable for a financial year in respect of floor funding are to sums that are payable by the Secretary of State in the year to a major precepting authority in addition to the police grant referred to in subsection (6A), and
b
references to sums payable for a financial year in respect of—
i
redistributed non-domestic rates,
ii
revenue support grant,
iii
additional grant, or
iv
special grant,
are to be construed in accordance with section 32(12).
7
The F30Welsh Ministers may by regulations do one or both of the following—
a
alter the constituents of any calculation to be made under subsection (2) or (3) above (whether by adding, deleting or amending items);
b
alter the rules governing the making of any calculation under subsection (2) or (3) above (whether by deleting or amending F31subsection (6), or by adding other provisions, or by a combination of those methods).
F677A
A statutory instrument containing regulations under subsection (7) is subject to annulment in pursuance of a resolution of Senedd Cymru.
8
F3. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
C14C1544 Calculation of basic amount of tax F57by authorities in Wales .
C16C17C18C19C32C34C38C40C42C44C46C48C501
In relation to each financial year a major precepting authority F34in Wales shall calculate the basic amount of its council tax by applying the formula—
where—
R is the amount calculated (or last calculated) by the authority under section 43(4) above as its budget requirement for the year;
P is the aggregate of the sums which the authority estimates will be payable to it for the year in respect of redistributed non-domestic rates, revenue support grant F4, additional grant F5, F64special grant, floor funding or police grant;
T is the aggregate of the amounts which are calculated by the billing authorities to which the authority issues precepts (“the billing authorities concerned") as their council tax bases for the year for their areas, or (as the case may require) for the parts of their areas falling within the authority’s area, and are notified by them to the authority within the prescribed period.
F651A
In this section—
a
references to sums payable for a financial year in respect of—
i
redistributed non-domestic rates,
ii
revenue support grant,
iii
additional grant, and
iv
special grant,
are to be construed in accordance with section 33(12); and
b
references to sums payable for a financial year in respect of floor funding are to be construed in accordance with section 43(6C).
2
Where the aggregate calculated (or last calculated) by the authority for the year under subsection (2) of section 43 above does not exceed that so calculated under subsection (3) of that section, the amount for item R in subsection (1) above shall be nil.
F35C203
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
4
5
The F38Welsh Ministers shall make regulations containing rules for making for any year the calculations required by item T in subsection (1) above; and the billing authorities concerned shall make the calculations for any year in accordance with the rules for the time being effective (as regards the year) under the regulations.
F685A
A statutory instrument containing regulations under subsection (5) is subject to annulment in pursuance of a resolution of Senedd Cymru.
6
Regulations prescribing a period for the purposes of item T in subsection (1) above may provide that, in any case where a billing authority fails to notify its calculation to the precepting authority within that period, that item shall be determined in the prescribed manner by such authority or authorities as may be prescribed.
7
Any negative amount given by a calculation under subsection (1) above shall be assumed to be nil for the purposes of this Chapter.
C21C2245 Additional calculations where special items relate to part only of area.
1
This section applies where for any financial year an item mentioned in section 46(1) below relates to a part only of a major precepting authority’s area; and in this section “special item” means any such item which so relates and “the relevant part”, in relation to such an item, means the part concerned.
2
The authority shall calculate the basic amount of its council tax for dwellings in a part of its area to which no special item relates by applying the formula—
where—
B is the amount calculated (or last calculated) by the authority under F22section 42B(1) above or section 44(1) above as the basic amount of its council tax;
A is the aggregate amount of all special items;
T is the amount determined for item T F23in section 42B(1) above or in section 44(1) above.
3
The authority shall calculate the basic amount of its council tax for dwellings in a part of its area to which one or more special items relate by adding to the amount given by the formula in subsection (2) above the aggregate of the amounts which, in relation to each of those special items, are given by the formula—
where—
S is (in each case) the amount of the special item;
TP is (in each case) the aggregate of the amounts which are calculated by the billing authorities to which the authority has power to issue precepts as respects the special item (“the billing authorities concerned") as their council tax bases for the year for their areas, or (as the case may require) for the parts of their areas falling within the relevant part, and are notified by them to the authority within the prescribed period.
4
The Secretary of State shall make regulations containing rules for making for any year the calculations required by item TP in subsection (3) above; and the billing authorities concerned shall make the calculations for any year in accordance with the rules for the time being effective (as regards the year) under the regulations.
5
Regulations prescribing a period for the purposes of item TP in subsection (3) above may provide that, in any case where a billing authority fails to notify its calculation to the precepting authority within that period, that item shall be determined in the prescribed manner by such authority or authorities as may be prescribed.
F595A
Regulations under subsection (4) that apply to authorities in England may contain different rules for the purposes of calculating item TP in relation to different kinds of special item.
5B
Regulations under subsection (4) that make provision by virtue of subsection (5A) may make consequential amendments to this Act.
6
Any negative amount given by a calculation under subsection (2) or (3) above shall be assumed to be nil for the purposes of this Chapter.
C2346 Special items for purposes of section 45.
1
The items referred to in section 45(1) above are any expenses of the major precepting authority which are its special expenses and were taken into account by it in making the calculation in relation to the year under F24section 42A(2) above or section 43(2) above.
2
For the purposes of subsection (1) above—
F6a
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
b
provided a resolution of a county council to the following effect is in force, the expenses of meeting a levy issued to or anticipated by it are its special expenses or (if the resolution relates to some only of those expenses) those to which the resolution relates are its special expenses;
F7c
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
F8d
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
3
For the purposes of section 45(1) above—
F9a
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
b
expenses which are special by virtue of a resolution under subsection (2)(b) above relate to the part of the council’s area in which the levying body carries out functions;
F10c
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
F11d
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
F124
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
C2447 Calculation of tax for different valuation bands.
1
The amount to be stated under section 40(2)(a) above for any financial year in respect of any category of dwellings listed in a particular valuation band shall be calculated by applying the formula—
where—
A is the amount calculated (or last calculated) by the major precepting authority for that year under F25section 42B(1) above or section 44(1) above or, where section 45 above applies, the amount calculated (or last calculated) by it for that year under subsection (2) or (3) of that section in relation to that category of dwellings;
N is the number which, in the proportion set out in section 5(1) above, is applicable to dwellings listed in that valuation band;
D is the number which, in that proportion, is applicable to dwellings listed in valuation band D.
F131A
Where the precepting authority is the Greater London Authority, subsection (1) above shall have effect with the substitution of the following definition for the definition of A—
“A is the amount calculated (or last calculated) by the Greater London Authority for that year under section 88(2) of the Greater London Authority Act 1999 or, where section 89 of that Act applies, the amount calculated (or last calculated) by it for that year under subsection (3) of that section in relation to that category of dwellings; ".
2
Dwellings fall within different categories for the purposes of this section according as different calculations have been made in relation to them under section 45 above.
F143
Where the precepting authority is the Greater London Authority, subsection (2) above shall have effect with the substitution for the reference to section 45 above of a reference to section 89 of the Greater London Authority Act 1999
C2548 Calculation of amount payable by each billing authority.
1
This section makes provision for calculating the amount required by section 40(2)(b) above to be stated in a precept as the amount payable by a billing authority for any financial year F15; and—
a
subsection (1A) below applies in relation to a precept issued by the Greater London Authority; and
b
subsections (2) to (6) below apply in relation to a precept issued otherwise than by the Greater London Authority.
F161A
Where an amount calculated (or last calculated) for the year under section 88(2) or 89(3) of the Greater London Authority Act 1999 applies to dwellings in the billing authority’s area, the amount payable by that authority shall be calculated by applying the formula—
where—
C is the amount so calculated; and
T is the amount which, in relation to the billing authority, is determined for item T in section F3931B(1) above.
2
Where an amount calculated (or last calculated) for the year under section F4042B(1) or (as the case may be) 44(1) above or under section 45(2) or (3) above applies to dwellings in the whole of the billing authority’s area, the amount payable by that authority shall be calculated by applying the formula—
where—
C is the amount so calculated;
T is the amount which, in relation to the billing authority, is determined for item T in F41section 31B(1) or (as the case may be) section 33(1) above.
3
Where an amount calculated (or last calculated) for the year under section F42 42B(1) or 44(1) above or under section 45(2) or (3) above applies to dwellings in a part of the billing authority’s area, the amount payable by that authority shall be calculated by applying the formula—
where—
CP is the amount so calculated;
TP is the amount which is calculated by the billing authority as its council tax base for the year for the part of its area concerned and is notified by it to the major precepting authority within the prescribed period.
4
Where different amounts calculated (or last calculated) for the year under section 45(2) or (3) above apply to dwellings in different parts of the billing authority’s area, the amount payable by that authority shall be the aggregate of the amounts which, in relation to each of the amounts so calculated, are given by the formula—
where—
CP is (in each case) the amount so calculated;
TP is (in each case) the amount which is calculated by the billing authority as its council tax base for the year for the part of its area concerned and is notified by it to the major precepting authority within the prescribed period.
5
The Secretary of State shall make regulations containing rules for making for any year the calculations required by item TP in subsection (3) or (4) above; and the billing authority shall make the calculations for any year in accordance with the rules for the time being effective (as regards the year) under the regulations.
6
Regulations prescribing a period for the purposes of item TP in subsection (3) or (4) above may provide that, in any case where the billing authority fails to notify its calculation to the precepting authority within that period, that item shall be determined in the prescribed manner by such authority or authorities as may be prescribed.
C2649 Substitute calculations.
F171
A major precepting authority which has made calculations in relation to a financial year in accordance with—
F50za
sections 42A, 42B and 45 to 48 above (originally or by way of substitute),
a
sections 43 to 48 above (originally or by way of substitute),
b
sections 85 to 90 of the Greater London Authority Act 1999 and sections 47 and 48 above, or
c
sections 85, 86 and 88 to 90 of, and Schedule 7 to, that Act and sections 47 and 48 above (by way of substitute),
may make calculations in substitution in relation to the year in accordance with the relevant provisions.
1A
For the purposes of subsection (1) above, the relevant provisions are—
F51za
in a case falling within paragraph (za), the provisions specified in that paragraph;
a
in a case falling within paragraph (a), the provisions specified in that paragraph; and
b
in a case falling within paragraph (b) or (c), the provisions specified in paragraph (c).
2
None of the substitute calculations shall have any effect if—
F45za
in the case of a major precepting authority in England other than the Greater London Authority, the amount under section 42A(4) above, or any amount calculated under section 42B(1) or 45(2) or (3) above as the basic amount of council tax applicable to any dwelling, would exceed that so calculated in the previous calculations; or
a
F18in the case of a major precepting authority F46in Wales , the amount calculated under section 43(4) above, or any amount calculated under section 44(1) or 45(2) or (3) above as the basic amount of council tax applicable to any dwelling, would exceed that so calculated in the previous calculations; or
F19aa
in a case where the major precepting authority is the Greater London Authority—
i
the amount of any component F47council tax requirement calculated under subsections (4) to (7) of section 85 of the Greater London Authority Act 1999,
ii
the amount calculated under subsection (8) of that section, or
iii
any amount calculated under section 88(2) or 89(3) of that Act as the basic amount of council tax applicable to any dwelling,
would exceed that so calculated in the previous calculations; or
b
the authority fails to comply with F48whichever of subsections (2A), (3) and (3A) below is applicable to it in making the substitute calculations.
F432A
In making substitute calculations under section 42B(1) or 45(3) above, an authority in England other than the Greater London Authority must use any amount determined in the previous calculations for item T in section 42B(1) above or item TP in section 45(3) above.
3
In making substitute calculations under section 44(1) or 45(3) above, F52an authority in Wales must use any amount determined in the previous calculations for item P or T in section 44(1) above or item TP in section 45(3) above.
F203A
4
For the purposes of subsection (3) above, the authority may treat any amount determined in the previous calculations for item P in section 44(1) above as increased by the amount of any sum which—
a
it estimates will be payable to it for the year in respect of additional grant; and
b
was not taken into account by it in making those calculations.
F534A
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
F534B
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
F534C
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
F444D
Subsections (2) and (2A) above shall not apply if the previous calculations have been quashed because of a failure to comply with sections 42A, 42B and 45 to 48 above in making the calculations.
5
Subsections (2) and (3) above shall not apply if the previous calculations have been quashed because of a failure to comply with sections 43 to 48 above in making the calculations.
F216
Subsections (2) and (3A) above shall not apply if the previous calculations have been quashed because of a failure to comply with the appropriate Greater London provisions in making the calculations.
7
For the purposes of subsection (6) above, “the appropriate Greater London provisions” means—
a
in the case of calculations required to be made in accordance with sections 85 to 90 of the Greater London Authority Act 1999 and sections 47 and 48 above, those provisions; and
b
in the case of calculations required to be made in accordance with sections 85, 86 and 88 to 90 of, and Schedule 7 to, that Act and sections 47 and 48 above, those provisions.
8
Where the major precepting authority is the Greater London Authority, any substitute calculations under this section shall be made in accordance with Schedule 7 to the Greater London Authority Act 1999.
Pt. I (ss. 1-69) modified (6.3.1992) by Local Government Act 1992 (c. 19), s. 18(1)(a)(b).