Local Government Finance Act 1992

Calculations by major precepting authorities E+W

43 Calculation of budget requirement. E+W

(1) In relation to each financial year a major precepting authority shall 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, other than expenditure which it estimates will be so incurred in pursuance of regulations under section 99(3) of the 1988 Act;

(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

[F1 (i) in respect of redistributed non-domestic rates, revenue support grant, additional grant, relevant special grant or police grant;

(ii) in respect of any precept issued by it; or

(iii) in pursuance of regulations under section 99(3) of the 1988 Act; 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 shall be its budget requirement for the year.

(5) In estimating under subsection (2)(a) above an authority which is a county council shall take into account the amount of any levy issued to it for the year but (except as provided by regulations under section 74 of the 1988 Act) shall not anticipate a levy not issued.

[F2 (5A) In estimating under subsection (2)(a) above—

(a) a police authority established under section 3 of the M1 Police Act 1996 (authorities for areas outside London), and

(b) the Receiver for the Metropolitan Police District,

shall take into account the amount of any levy issued to it under section 17 or 62 of the Police Act 1997 (levies issued by the Service Authority for the National Criminal Intelligence Service and the Service Authority for the National Crime Squad) for the year, but (except as provided by an order under either of those sections) shall not anticipate a levy not issued.]

(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.

[F3 (6A) [F4 Subject to subsections (6B) and (6C) below, in]this section and section 44 below, “police grant" and “relevant special grant" have the meanings given by section 32(12) above.]

[F5 (6B) Subsection (6A) above does not apply in relation to a major precepting authority in Wales.

(6C) In relation to a major precepting authority in Wales in this section and section 44 below “police grant" means so much of the grant payable in accordance with paragraph 3.1 of the relevant police grant report as excludes the amounts shown in column (b) of the Table set out below that paragraph.

(6D) In subsection (6C) above “the relevant police grant report" means the police grant report (Police Grant Report (England and Wales) 1999/2000) approved by a resolution of the House of Commons pursuant to section 46 of the Police Act 1996 F6 on 4th February 1999.]

(7) 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) [F7 , (5A)] and (6) above, or either of them, or by adding other provisions, or by a combination of those methods).

(8) References in this section to expenditure incurred by an authority shall be construed in accordance with section 41(3) of the M2 Local Government and Housing Act 1989.

Textual Amendments

F1 S. 43(3)(a)(i)(ii)(iii) substituted for words in s. 43(3)(a) (3.2.1995) by S.I. 1995/234, reg. 4(1)

F2 S. 43(5A) inserted (31.10.1997 subject to transitional provisions in art. 3 of the the commencement S.I.) by 1997 c. 50, s. 134(1), Sch. 9 para. 68(2); S.I. 1997/2390, arts. 2(2)(w), 3

F3 S. 43(6A) substituted (3.2.1995) by S.I. 1995/234, art. 4(2)

F4 Words in s. 43(6A) substituted (16.2.1999) by S.I. 1999/296, reg. 3(2)

F5 S. 43(6B)-(6D) inserted (16.2.1999) by S.I. 1999/296, reg. 3(3)

F6 1996 c. 16.

F7 Words in s. 43(7)(b) inserted (31.10.1997 subject to transitional provisions in art. 3 of the commencement S.I.) by 1997 c. 50, s. 134(1), Sch. 9 para. 68(3); S.I. 1997/2390, arts. 2(2)(w), 3

Modifications etc. (not altering text)

C5 S. 43 excluded (12.1.2000 subject to the transitional provisions set out in Schedule 1 Table 1 of the commencing S.I.) by 1999 c. 29, s. 85(1) (with Sch. 12 para. 9(1)); S.I. 1999/3434, art. 2

C6 Pt. I Chs. III-IV (ss. 30-52) modified (E.) (1.2.1993) by S.I. 1993/22, art. 4(2)

S. 43 modified (12.1.2000) by S.I. 1999/3435, art. 3, Table 2

C7 Ss. 40, 43 restricted (1.11.1994 for the purposes of any financial year beginning on or after 1,4.1995) by 1994 c. 29, s. 28(1)(b); S.I. 1994/2025, art. 7(2)(c)(subject to arts. 7(3)(4))

C8 S. 43 restricted (22.8.1996) by 1996 c. 16, ss 19(1)(b), 104(1)

C9 Power to modify s. 43 conferred (25.6.1997) by 1997 c. 50, ss. 62(4)(b); S.I. 1997/1377, art. 2(2)(e)

C10 S. 43(2) modified (E.) (6.2.1999) by S.I. 1999/228, regs. 4, 6, Sch.

C11 S. 43(2)(a) amended (30.11.1995) by S.I. 1995/2889, reg. 11(2)

C12 S. 43(a)(iii) amended (30.11.1995) by S.I. 1995/2889, reg. 11(2)

Marginal Citations

M1 1996 c. 16.

M2 1989 c. 42.

44 Calculation of basic amount of tax. E+W

(1) In relation to each financial year a major precepting authority 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 [F8 , additional grant [F9 , relevant special grant 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.

(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.

(3) The aggregate of the sums mentioned in item P in subsection (1) above shall be—

(a) increased by the aggregate amount of any 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; and

(b) reduced by the aggregate amount of any sums which the authority estimates will be paid by it in the year to billing authorities in accordance with such regulations.

(4) Regulations under section 43(7) above may make such consequential alterations of the constituents of any calculation required by item P in subsection (1) above or subsection (3) above (whether by adding, deleting or amending items) as appear to the Secretary of State to be necessary or expedient.

(5) The Secretary of State 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.

(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.

Textual Amendments

F8 Words in s. 44(1) substituted (8.2.1994) by S.I. 1994/246, reg. 4(1)

F9 Words in s. 44(1) substituted (3.2.1995) by S.I. 1995/234, reg. 5

Modifications etc. (not altering text)

C13 Pt. I Chs. III-IV (ss. 30-52) modified (E.) (1.2.1993) by S.I. 1993/22, art. 4(2)

C14 S. 44 excluded (12.1.2000 subject to transitional provisions in Schedule 1, Table 1 of the commencing S.I.) by 1999 c. 29, s. 88 (with Sch. 12 para. 9(1)); S.I. 1999/3434, art. 2

C15 S. 44(1) modified (W.) (28.2.2007 with application as mentioned in reg. 1(3) of the amending S.I.) by The Local Authorities (Alteration of Requisite Calculations) (Wales) Regulations 2007 (S.I. 2007/571), reg. 5

C16 S. 44(1) modified (E.) (6.2.2007 with application as mentioned in reg. 1(2)(3) of the amending S.I.) by The Local Authorities (Alteration of Requisite Calculations) (England) Regulations 2007 (S.I. 2007/227), reg. 6

C17 S. 44(1) modified (12.1.2000 temp. from 1.4.2000 until 31.3.2001) by S.I. 1999/3435, art. 3, Table 2

S. 44(1) modified (E.) (7.2.2003) by The Local Authorities (Alteration of Requisite Calculations) (England) Regulations 2003 (S.I. 2003/195), reg. 5

S. 44(1) modified (7.2.2004) by The Local Authorities (Alteration of Requisite Calculations) (England) 2004 (S.I. 2004/243), reg. 5

S. 44(1) modified (25.2.2004) by The Local Authorities (Alteration of Requisite Calculations) (Wales) Regulations 2004 (S.I. 2004/451), reg. 3

S. 44(1) modified (E.) (5.2.2005) by The Local Authorities (Alteration of Requisite Calculations) (England) Regulations 2005 (No. 190) (S.I. 2005/190), {reg. 5}

S. 44(1) modified (W.) (15.2.2006) by The Local Authorities (Alteration of Requisite Calculations) (Wales) Regulations (S.I. 2006/344), {reg. 5}

S. 44(1) modified (E.) (8.2.2006 with effect as mentioned in reg. 1(3)) by The Local Authorities (Alteration of Requisite Calculations) (England) Regulations (S.I. 2006/247), {reg. 5}

C18 S. 44(1) amended (E.) (1.2.2002 with application as mentioned in reg. 1(2)) The Local Authorities (Alteration of Requisite Calculations) (England) Regulations 2002 (S.I. 2002/155), reg. 5

C19 S. 44(3) modified (E.) (6.2.1999) by S.I. 1999/228, reg. 5

S. 44(3) modified (5.2.2000) by S.I. 2000/213, reg. 5

S. 44(3) modified (2.2.2001 with effect as mentioned in reg. 1(3) of the amending S.I.) by S.I. 2001/216, reg. 5

C20 S. 44(3)(a) amended (30.11.1995) by 1995 S.I. 1995/2889, reg. 11(2)

45 Additional calculations where special items relate to part only of area. E+W

(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 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 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.

(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.

Modifications etc. (not altering text)

C21 Pt. I Chs. III-IV (ss. 30-52) modified (E.) (1.2.1993) by S.I. 1993/22, art. 4(2)

C22 S. 45 excluded (12.1.2000 subject to transitional provisions Schedule 1, Table 1 of the commencing S.I.) 1999 c. 29, s. 89 (with Sch. 12 para. 9(1)); S.I. 1999/3434, art. 2

46 Special items for purposes of section 45. E+W

(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 section 43(2) above.

(2) For the purposes of subsection (1) above—

F10 (a) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

(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;

F11 (c) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

F12 (d) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

(3) For the purposes of section 45(1) above—

F13 (a) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

(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;

F14 (c) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

F15 (d) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

F16 (4) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Textual Amendments

F10 S. 46(2)(a) repealed (1.4.1995) by 1994 c. 29, s. 93, Sch. 9 Pt. I; S.I. 1994/3262, art. 4(1), Sch.

F11 S. 46(2)(c) omitted (7.1.1997) by virtue of S.I. 1996/3071, art. 2. Sch. para. 4(a)

F12 S. 46(2)(d) repealed (12.1.2000) by 1999 c. 29, ss. 91, 423, Sch. 34 Pt. I (with Sch. 12 para. 9(1)); S.I. 1999/3434, art. 2, Sch. 2 Table 1

F13 S. 46(3)(a) repealed (1.4.1995) by 1994 c. 29, s. 93, Sch. 9 Pt. I; S.I. 1994/3262, art. 4(1), Sch.

F14 S. 46(3)(c) omitted (7.1.1997) by virtue of S.I. 1996/3071, art. 2 Sch. para. 4(b)

F15 S. 46(3)(d) repealed (12.1.2000) by 1999 c. 29, ss. 91, 423, Sch. 34 Pt. I (with Sch. 12 para. 9(1)); S.I. 1999/3434, art. 2, Sch. 2 Table 1

F16 S. 46(4) repealed (12.1.2000) by 1999 c. 29, ss. 91, 423, Sch. 34 Pt. I (with Sch. 12 para. 9(1)); S.I. 1999/3434, art. 2, Sch. 2 Table 1

Modifications etc. (not altering text)

C23 Pt. I Chs. III-IV (ss. 30-52) modified (E.) (1.2.1993) by S.I. 1993/22, art. 4(2)

47 Calculation of tax for different valuation bands. E+W

(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 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.

[F17 (1A) 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.

[F18 (3) 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]

Textual Amendments

F17 S. 47(1A) inserted (12.1.2000 subject to transitional provisions in Schedule 1 Table 1, of the commencing S.I.) by 1999 c. 29, s. 92(2) (with Sch. 12 para. 9(1)); S.I. 1999/3434, art. 2

F18 S. 47(3) inserted (12.1.2000 subject to transitional provisions in Schedule 1 Table 1 of the commencing S.I.) by 1999 c. 29, s. 92(3) (with Sch. 12 para. 9(1)); S.I. 1999/3434, art. 2

Modifications etc. (not altering text)

C24 Pt. I Chs. III-IV (ss. 30-52) modified (E.) (1.2.1993) by S.I. 1993/22, art. 4(2)

48 Calculation of amount payable by each billing authority. E+W

(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 [F19 ; 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.]

[F20 (1A) 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 33(1) above.]

(2) Where an amount calculated (or last calculated) for the year under section 44(1) or 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 section 33(1) above.

(3) Where an amount calculated (or last calculated) for the year under section 44(1) or 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.

Textual Amendments

F19 Words in s. 48(1) added (12.1.2000 subject to transitional provisions in Schedule 1, Table 1, of the commencing S.I.) by 1999 c. 29, s. 93(2) (with Sch. 12 para. 9(1)); S.I. 1999/3434, art. 2

F20 S. 48(1A) inserted (12.1.2000) by 1999 c. 29, s. 93(3) (with Sch. 12 para. 9(1)); S.I. 1999/3434, art. 2

Modifications etc. (not altering text)

C25 Pt. I Chs. III-IV (ss. 30-52) modified (E.) (1.2.1993) by S.I. 1993/22, art. 4(2)

49 Substitute calculations. E+W

(1) A major precepting authority which has made calculations in accordance with sections 43 to 48 above in relation to a financial year (originally or by way of substitute) may make calculations in substitution in relation to the year in accordance with those sections.

(2) None of the substitute calculations shall have any effect if—

(a) 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

(b) the authority fails to comply with subsection (3) below in making the substitute calculations.

(3) In making substitute calculations under section 44(1) or 45(3) above, the authority 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.

(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.

(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.

Modifications etc. (not altering text)

C26 Pt. I Chs. III-IV (ss. 30-52) modified (E.) (1.2.1993) by S.I. 1993/22, art. 4(2)