Best bits: How to check if you’re paying too much council tax

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0:59Martin Lewis:Welcome to a special Best Bits podcast, selected and put together by the one and only podcast producer Simon. I'm interested to see myself. I'm going to begin it. It's being chosen from our Big Topics pods. Much of that comes from my BBC Radio 5 live share with Adrian Childs. Of course, as it's Best Bits, if you hear me mention any specific products or rates, please do double check that they haven't changed. But big picture should all be good. In this week's Best Bits, we'll be starting with five different ways to slash council tax, how you check and challenge your band, why you may be missing out on discounts, and why you may be missing out on support, and the two are different.

1:36Martin Lewis:And our tellers this week is a brilliant one with insider tips from Aircrew, what they think you need to know when you're planning to go abroad. Play the theme tune. I got bills, I gotta pay.

1:52Martin Lewis:Now I promise we're going to get into the podcast proper in a moment. We're going to be talking about council tax, how you check and challenge your band, why you may be missing out on a discount, why you may be missing out on council tax support. But Adrian and I are middle-aged men. And when two middle-aged men get together, there's only one thing they talk about first. I just got the giggles then, Martin, because it occurs to me every time we meet each other. We start off air. We have a conversation like we might have in a care home in 20 years' time. It's just ailment discussion. All my rotator cuff's gone.

2:24I've got, I'm just falling apart. I've got a cough. I've got head fever on my back.

2:28Martin Lewis:I'm a man in my early mid-50s. I turned 54 at the weekend. So I'm early mid-50s who does a lot of exercise. And I think you have to make the choice at our age. Either you're not going to do any exercise, in which case your body's going to fall apart because you're not doing exercise, or you're going to do lots of exercise, in which case your body's going to break because you're doing lots of exercise. So I've been doing this press-up thing where I wanted to do 20 ,000, then I increased my chance to 25 ,000 in a year, but my rotator cuff has now gone, so I haven't done press-ups for 10 days. I've done 8 ,400 so far this year, but I'm now off the press-ups and it's very frustrating.

3:04But it says something about your psychological makeup, because you've reduced it in what you'd said, the whole thing, to a binary absurdity, is that you either do nothing and fall to pieces or do so much, you're knackering yourself. There is a happy median.

3:17Martin Lewis:I know he's not as exciting. I don't understand. I've never met a clairvoyant. Sorry, that was a happy medium. Terrible pun. No, I am a binary person. I'm nought or one. I don't have in between. You're nought or a hundred. Yeah, okay. Well, that wouldn't be binary, Adrian. No, okay. To be fair. And that is how I operate. So my exercise, you know, I do cardio every morning. I do gym, not this week because of the rotator cuff. Gym session and weight session at least five times a week. And I do my 70 press-ups a day. and I'm upset and I don't like missing. You're doing press-ups, so didn't you start on that?

3:49Martin Lewis:Yeah, I just started. I went to do one. Well, I couldn't do one at first, then I did one. And I'm building up. I'm 60 in March, next March, and I want to be able to do 60 press-ups before I'm 60. So I've got up to doing eight every day and I'm increasing by T.C. sensible. But the mistake I made, I do three sets of 25 normally, is I started putting my feet up on a chair to do them. because I wanted to do incline press-ups to get the upper part of the chest, get some work out as well. Why don't you get Lara to sit on your back while you do it as well? And your daughter and any family pets, and then your father-in-law and everyone else.

4:26Yeah, I know.

4:30Let's move on to council tax. So let's start with the big one, checking and challenge your council tax band. You've been doing this one for years. I have indeed. I mean, I think it's one of those ones, it's just so depressing, and everybody knows it's a nonsense the way it was done in the first place. And nobody's got the political will to have a complete, to organise it properly because there'd be losers as well as winners and politically it'd be disastrous.

4:57Martin Lewis:In my view, council tax is a broken tax. I mean, we need to go back and there'll be many people here, you know, in their 30s who will not remember how this all happened. So we had riots over what was called the community charge, but better known as the poll tax. literal riots in the street over this tax. And therefore the government had to come up within the time, they had to come up with a new form of local taxation to replace it. And they came up with the council tax. And so what they needed to do, because the council tax was effectively based on the value of your house, they had to go around and they had to value properties across England, Scotland and Wales.

5:34Martin Lewis:And this was done in 1991. And without any exaggeration, it was primarily done by what is called second gear valuations. Two people in a car, one driving, the other an estate agent or a quantity surveyor or someone of that ilk, who had a list of a few details about each property on a piece of paper in front of them, and they went past having a look going, Bansi, Bandy, Bansi, Bambi. And that's how your council tax ban was originally done. Now, in Wales, they have rebanded. This 1991 valuation, and council tax started in 1993, was meant to be a stopgap valuation just to set the system up. But everybody knows what I'm about to say.

6:23Martin Lewis:That 1991 stopgap valuation, if you are in England or Scotland, is the only mainstream valuation we have ever had, unless you've got a new built house and in certain circumstances. and is still what dictates which council tax band you are in today. Even with all the moves we've had, even with the fact that we knew it was erroneous at the time and that's why there are an estimated 400 ,000 homes in England and Scotland in the wrong band. Some too high, some too low and you can, although they don't make it as easy as they should, you can check and challenge your band. But you have to do it carefully.

7:00Martin Lewis:Emma wants to know how to do that, so go on. So let's do the check first. And the check is pretty simple. And I've got two steps to it, and it's very important. I'll explain why there are two steps to it. The challenge is harder. The first check is to find whether you're in a higher band than a neighbour in a preferably identical, but if not as similar as you can possibly get, property. Now, don't worry, you don't need to go next door and knock on and say, ah, what council tax band are you in place? Because it might not make you popular. you can go onto gov.uk for England or the Scottish Assessors Association for Scotland, England and Wales gov.uk and you can just look up council tax bands there, both yours and other people's.

7:42Martin Lewis:So you can have a look and many people will have done this to see what your band and other people's band is. So the first check is the neighbours check. Am I in a higher band than neighbours in an identical property? but this is really really important and i've seen some of the questions we've got coming in which just have misunderstood this point you are asking for your band to be reviewed you may be in a higher band than neighbors in a similar identical property because their band is too low not because your band is too high and by reviewing it you could get their band increased which you do not want to happen it will not make you popular to have all your neighbors bands increased.

8:26Martin Lewis:But hang on, but if we're striving towards fairness, then we should want fairness, shouldn't we? I mean, look, I totally get your point. So let me try and answer that in a semi-political way. The system is broken. Our political classes have never had the chutzpah to rework and revalue this system as it desperately needed because it would be incredibly unpopular because there'd be winners and losers. Right? I mean, never mind just fixing the system we've got. You could also look up, because just remember, the band you are in, let's be absolutely plain, when you go and look at this on the chart, the band you are in is literally based on council tax bands from back in 1991.

9:11Martin Lewis:You know, a band A property is a property under 40 grand in England, under 27 grand in Scotland. You can't buy properties at that amount anymore. The top band is over 320 grand in England, over£212 ,000 in Scotland. I mean, just the numbers are different because it's a different world. And it's not just updating what we have, but you could think of a whole different way and whole different forms of banding. And, you know, people in very big houses don't pay proportionately that much more. This is why the Chancellor's chosen to jemmy it with what's going to be called being called the mansion tax, which is basically a council tax surcharge.

9:44Martin Lewis:So you're right, Adrian. But I'm not sure that that predicates that individuals should go around snooping and trying to get their neighbours band increased. I mean, that's an individual's decision if they choose to do it. You're trying to get your own decreased, and you might have the effect of getting the others increased. But A, would they know it was your fault? And B, that implies there are people who, this happens, and every now and then somebody gets an unwelcome letter from saying, well, we're bumping your council. And this is why when I invented my check and challenge system back in 2007, although we finessed it, right, and I did it, I always remember doing it, it was because I wrote a little bit about it, and I put it in my web forum, and I got some responses and people tried it.

10:23Martin Lewis:And then I said, let me know how your experience is. And they came through. And then I wrote a guide on it and said, test this. And then I got loads of feedback. And then I did the guide formally. And I did a big telly programme. Biggest telly audience I've ever had on telly. I think it was about six and a half million. And was using those research. And the reason I came up with the second check is to stop that issue. And the second check is what I called the valuation check. Now, it's really important that I say to people that the valuation check is not an evidential check. When you come to challenging your band, they will not take this into account.

10:56Martin Lewis:This second check is one I invented so that you can work out that on the huge likelihood it's you who's in two higher band, not your neighbours who are in two lower band. Right. And the valuation check is this. You need to assess your house's value back in 1991. 1991. It sounds complicated, but effectively, if you bought a house since 1991 or one of your neighbours has an identical property since 1991, you just need to back calculate it to 1991. And you can do that in a complicated way using the house price indices. But there is a free tool available online that will do this for you. I'm just not allowed to tell you where it is.

11:36Martin Lewis:Right. Okay. Right. So if then that you've done both checks and both indicate, first of all, that you're in a higher band and neighbours in an identical or similar properties, and second, that on your back calculation, you are on the high end of your band or possibly in too higher band, then you should be looking at challenging. But if you only pass the first one and it looks like you're in the right band, you need to be aware you could be dropping your neighbour's council tax band. OK, so you challenge it. Inherent in that is that it might end up going up. I, and I've had probably tens of thousands of successes of this reported to me since I launched the system and they still come in regularly.

12:20Martin Lewis:In fact, just by chance, just as I'll do it, when I was coming in this morning, I hope I've got it here. Where was it? I just read it. And via the magic of podcasting, and more technically the magic of editing, I now have that case study. because I haven't asked for their permission to read it out as it was just emailed into me via my website I'm going to read it to you anonymously it said Martin, following your suggestion to check on council tax banding we submitted evidence over a year ago patience paid off because on my husband's birthday in April this year we received a£9 ,600 as a rebate since we moved into the property in 1991 and a drop in our council tax band thank you for inspiring us to do this well i'm absolutely denited anonymous person that you did that so the whole point about getting your band lowered is not only is the band itself lowered but you get a backdated payout about going by back to when you moved into the property or 1993 whichever is sooner so if you moved in in 1999 you'll go back to 1999 and that's why this is so important this conversation because this is a substantial amount of money we're talking about for many people who are in the wrong band.

13:36Martin Lewis:I have never had anyone who's used my system tell me that their neighbour's band has gone up. I've heard of it going up, but not people who've done both checks. So my hope is that that valuation check done properly. But you need to understand, and there are people out there who do and go, oh, it doesn't really show, but I'll try anyway. Well, then that's your risk. That's your risk. Michelle, we live in a row of 15 stone cottages. They are grade two listed in a conservation area. All the cottages are council tax B. There's one house in the middle, but exactly the same as the others is band A. How can I challenge it?

14:12How can I challenge it, please? I can't work out that from that,

14:15Martin Lewis:whether you're in the band A or you're in the band B. I mean, if you're in the band A, then you're on the... No, she must be in the band B from the nature of the question because you can't be lower than a band A, so she must be in a band B. I mean, it sounds to me very likely that the identical house in the middle is in too lower band. I mean, that would be my starting presumption that all the houses in band B are in the right band and the band A is in too lower band. So I would be very cautious in this situation. But if you go through this and you find and you do a valuation check and it looks very, very clearly, I would want in that circumstance, very robust, deep, clear water between your valuation in 1991 and a Band B valuation, not just at the limit, I'd want you to be well below it, then you could look at doing a challenge.

15:07Martin Lewis:I mean, I have to say, I have had successes over the years of entire streets being revalued. It isn't unheard of. Minesh, I've been disputing my band with the local council and not getting anywhere. I had a new build from 2013 on a semi-detached and the neighbour is band B, whereas I'm band C. How is this possible? It's a semi-detached. Well, it's possible because they valued you differently. So let's just go into... Well, how can it make sense? How can there be any logic to it? Well, we don't look for logic. We don't look for logic. We look for... I mean, I am presuming anybody doing this has been through my first two checks and has clearly passed the neighbour's check and the valuation check.

15:46Martin Lewis:And if you haven't, you must do that. But on that assumption, you can submit a challenge to your band. Now, in England and Wales, there is a formal challenge and an informal challenge. In Scotland, there is only a formal challenge. For those in Northern Ireland, just as a note, there is no council tax, which is why I'm not talking about Northern Ireland here. Now, the formal challenge, very frustratingly, can be done by whether you own or rent. But in general terms, you must have lived in the property for six months or less. If renters are challenging, by the way. By courtesy, you should notify your landlord.

16:20Martin Lewis:There are some other reasons you can do a formal challenge, which is a fundamental change in the property, say, from house to flats, a change in its use, parties now business, for example, the local area has changed, you've just had a nightclub built next door, or in Scotland only, there have been significant property price drops where you are. So, just as an aside, this is one of those life financial management rulings everyone needs to remember. whenever you move home, remember to check your council tax band and do the check and challenge within the first six months, because the formal challenge is so much easier than the informal challenge route.

16:58Martin Lewis:So that's my first point. Within the formal challenge, you don't actually need to submit evidence. You do within the informal challenge, and there are good guides online of how to do an informal challenge. But the big thing that people in England and Wales can do that you need to know about, and this is the powerhouse improvement that I added to my guide about two years ago, is you need to request what is called your pad, your property attribute data, which is held on the gov.uk site. You are absolutely able to go and get it. You go onto it. It's got a, in the box when you go online, it's, I think my band is wrong.

17:37Martin Lewis:And the text on the next page add I want to request my property attribute data. The online form will ask you a few questions. Now, what this is all about is the property attribute data is literally what the valuation office agency who sorts council tax knows about your house. It will include its age or period, its type, semi-detached end of terrace, its floor area, number of bedrooms, living rooms, bathrooms, number of floors. And if you find that the pad is wrong, that is the big light. and we've had quite a lot of people who are in the wrong band have looked at their pad and gone, no, that's not correct about my house and that's the strongest possible evidence.

18:16Martin Lewis:Now, let's be plain here. If you're saying you're in too high a band and it says you've got two bedrooms and you've got four bedrooms, that's not the right way round. If it says you've got four bedrooms, you've got two bedrooms, that is the right way round. I mean, let's be sensible of what we're talking. But a crucial stage, Minesh, you have to get your pad details and you have to go and check, are your pad details correct about the property? And if they are, well, that's very strong. And what you then need to do is you then need to then go and identify neighbouring or nearby properties. This is for informal.

18:47Martin Lewis:You don't have to do this in a formal challenge, but I would do it anyway. And when I say in this step, identify neighbouring or nearby properties, this isn't like you did in the checks. We're now in the challenge phase. This is going to take real work. You need to be identifying up to five addresses in the same street or estate, though in the countryside, the Evaluation Office Agency will consider similar properties with an area as wide as 10 miles. They must have the same style or similar features. So semi-detached house must be compared with semi-detached house. They must be of a similar age.

19:17Martin Lewis:Don't compare the new build with the Victorian one. They must be of a similar size. Comparatable properties can be smaller and larger within 10%. And you're then looking and saying, look at all these details. The details you have on me are wrong. I'm going to give you a comparator to five of that per houses. And that is why I think I'm in the wrong band. So, look, and we need to be honest, we're on the radio here. This is a process and you will be able to find step-by-step help and templates to do this process online. Really what we're talking about today is the clarion call of what you should or shouldn't be doing, whether this is or isn't right for you.

19:53Martin Lewis:So the next stage to go through is to go and use the online help that's available to get you through this. Nicola, re-challenging banding in a new build house, In terms of finding similar properties, which are the implication being that the new build is different to the surrounding ones, can I use, say, a house built in the 1970s? It feels like new builds get higher banding just because they're new. And when you get the banding notification, there's absolutely no explanation of how it was determined. None of this system is transparent or good. I mean, it shouldn't work this way. And interestingly, one of the things...

20:25Martin Lewis:We've talked before on the show, I got the government to change council tax debt collection recently, and we'll be talking later about discounts, including severe mental impairment, which we got them to change some rules as well. One of my requests was to get rid of the formal informal rules where you have to do the challenge within six months, because I think it's ridiculous because people don't know how it's been going on. They will look at that, but they haven't done it yet. So, look, you're right. If you're in a new building, you're the only new build home in your area. It's really going to be very difficult to do this.

20:53Martin Lewis:And I don't think it's fair to say I have no evidence to say that new build homes are valued on too high a band. but clearly new build is a very difficult comparator to an older house if you are the only one. And people won't like me saying this but there's a bit of shrug your shoulders here. There's a bit of the system's broken, you do what you can do and if you can't do any more, you can't do any more. No, that's it. Willow, I need to change my band. I need to change my band. I've no idea where to start finding the price of my property from years ago. Willow's situation is they're in a row of terrace houses which are in Band B, and the rest of the very long road is in Band A.

21:33Martin Lewis:OK, so she's in Band B, everyone's in Band A. If your house has not been bought or sold since 1993, well then, if you're telling me they're all identical properties, one of those houses on those streets will have been bought or sold since 1993. You go on to the right moves of this world and the property price trackers, you can find what other properties have been bought and sold for. Then you need to convert it back to 1991. So you're just looking. Find the most, if your house is, you've been in it a long time, find the most similar house to yours. And in fact, if there are three or four that have sold, get all of the prices, work out what they were worth back in 1991.

22:12Martin Lewis:You know, get the prices from the property websites that are, it's free, you can just do it online, it's dead easy. And then convert them all into 1991 prices and take an average and see if that works for you. Okay, great.

22:26Martin Lewis:Do you need to cancel tax? Do you tell us? Next, I'm just getting some instructions from Bob after a walk. Did that go on air? I think it did, yes. Shall we just make sure? Adrian said, I forgot what we're doing. What we're doing now is, and I went, we're going to say, we're coming back to cancel tax, but we'll do tellers first. Yes, OK. So why don't you do that? Because nobody noticed. The tellers is great. Go on, tell us about the tellers. So the original question was, tellers, do you work for an airline, hotel or overseas travel business? If you do, what are the biggest mistakes people make when flying or going abroad and what are your top tips?