Herefordshire residents are encouraged to have their say on potential changes to the Council Tax Reduction Scheme (CTRS) for working age adults on low incomes.

The current Council Tax Reduction scheme in Herefordshire

In February 2026, Council approved its CTRS for 2026/27. The current scheme helps working aged residents who are in most financial need, by reducing their Council Tax by up to 100%, irrespective of the Council Tax band that the property falls into.

In December 2015, the scheme was approved at 80% relief and remained unchanged until 2021/22 when it was increased to 100% in response to the impact of the national pandemic.

The scheme is means-tested. Support is calculated based on need and applicants are required to provide financial information to support their claim.

What is the cost of the current scheme?

The overall cost of CTRS awarded to working age and pensioner claimants in 2026/27 is approximately £16.4 million per annum, supporting over 6,500 working age adults and 4,700 pensioners. The cost of this scheme is funded by all taxpayers in Herefordshire.

Proposed changes to the scheme

We are considering changes and welcome feedback from residents on reducing the level of support to help balance the cost of the scheme for all Council Tax payers whilst continuing to support those in greatest need.

We are consulting on a range of proposals for the scheme as part of a range of measures to balance our budget gap in 2027/28.

Despite continued delivery of savings and control of costs, grants from central government have reduced as a result of changes in the way that funding is distributed through the Fair Funding Review.

Continuing pressures on services for vulnerable adults and children and temporary accommodation, and rising costs across all services mean we must look for further savings and efficiencies to balance the council's budget and maintain a stable financial position.

Reducing the maximum support and restricting support to Band C Council Tax levels

We are proposing to reduce the maximum support working age households can receive

If the scheme is reduced from 100% to 80% in 2027/28, working age claimants will be required to pay at least 20% of the Council Tax bill. If the scheme is reduced to 50%, working age claimants will be required to pay at least 50% of the Council Tax bill.

We are proposing a Band C restriction

This means that if you live in a Band D property or above, your reduction would be worked out using the Council Tax charge for a Band C property, rather than your actual property band. You would need to pay the difference between the Band C amount and your actual Council Tax bill.

For a Band A property, the impact of the change would be £5.44 per week (CTRS at 80%) rising to £13.25 per week (CTRS at 50%).  The impact for the council would be additional council tax income of £2.3 million per annum if the scheme is reduced to 80% rising to £5.1 million per annum if the scheme is reduced to 50%.

Increasing non-dependent deductions

Non-dependent deductions apply where other adults are living with the council taxpayer applying for or entitled to Council Tax Reduction. A non-dependant is a person who lives with you who is not your partner or dependent child. Most commonly this will be a relative or friend who lives with you, or a child of yours who is an adult over 18.

Under the current scheme deductions are applied to the Council Tax Reduction award for each non-dependant who lives with you:

• No deduction = passported benefit or Universal Credit with no earnings
• £5.20 per week = not in remunerative work or in remunerative work but earnings less than £279
• £10.60 per week = in remunerative work / earnings £279 - £484.99
• £13.50 per week = in remunerative work / earnings £485 - £604.99
• £15.95 per week = in remunerative work / earnings above £605

We are proposing a change to the amount of non-dependent deductions to £15 a week. Based on 2025/26 figures this proposal would affect 986 households with an average increase in Council Tax payable of £10.89 per week. The impact for the council would be additional Council Tax income of £0.6 million per annum.

£5 minimum award

Where the weekly amount of Council Tax Reduction to which an applicant would otherwise be entitled under this scheme is less than £5, no Council Tax Reduction shall be awarded, and the entitlement for that weekly period shall be nil. This will affect approximately 187 applicants that will be taken out of the scheme based on the current qualifying criteria.

Changes to Temporary Absence rules

We are proposing to make the following changes within the scheme in respect of Temporary Absence rules:

Standard / general absence within Great Britain

There will be no changes to the current provision for standard absences within Great Britain as both working age and pension age schemes will continue to permit temporary absences of up 13 weeks.

Absence outside Great Britain

We are proposing to reduce the maximum allowed absence outside Great Britain for working age claimants from 13 weeks to a limit of 4 weeks, to align with pension age rules. The 4-week limit may be extended up to 8 weeks exclusively in cases involving a family bereavement.

Medical and care absences

Working age claimants are currently allowed up to 52 weeks of temporary absence for medical treatment or care regardless of location. We are proposing to restrict this to 52 weeks only if the treatment or care takes place in Great Britain. If the medical treatment or care occurs outside of Great Britain, the maximum permitted absence will be capped at 26 weeks.

Fleeing domestic violence

Working age claimants are currently allowed up to 52 weeks of temporary absence if they are fleeing domestic violence. We are proposing to restrict this to 52 weeks only if the claimant remains in Great Britain. If a claimant flees outside of Great Britain, the maximum permitted absence will be capped at 26 weeks.

Detained in custody

There will be no operational changes to the rules regarding claimants who are detained in custody or in remand as both the current working age and pension age rules already permit an absence of up to 52 weeks.

Impact of changes

Any changes to the CTRS will affect working age households in Herefordshire, who will receive Council Tax Reduction from 1 April 2027. Pension age households will not see any change.

Some other key aspects of the current scheme will remain the same:

• If you have capital of more than £6,000 no discount will be awarded. Any capital less than £6,000 will be ignored
• We will continue to protect War Pensioners by disregarding War Pensions or War Disablement pensions in full
• We will continue to maintain the Council Tax Discretionary Hardship scheme to support residents facing financial hardship

Have your say

Complete the consultation survey

Consultations privacy notice

The consultation is open for 7 weeks from 16 September until 4 November 2026.

How we'll use the information from this consultation

Feedback will be collected and the impact of proposals will be considered as part of the budget setting process ahead of decisions later this year to set a balanced budget in February 2027.

Any approved changes would be effective from 1 April 2027.