Martin Lewis has issued advice to homeowners and said that thousands could be owed hundreds of pounds. The money saving guru explained how people who have moved homes since 1993 may be eligible to claim back some cash.
The 52-year-old revealed that 800,000 households could be entitled for the refund in overpaid council tax without even knowing it. According to data from Freedom of Information (FOI) requests, a massive £141m is owed to people across 349 areas of the UK. Mr Lewis said people who have moved to a different council area over the last 31 years could now be eligible for a refund.
Council tax is based on the price of the property that we live in. These values have changed dramatically in recent years, with some areas seeing a spike in property values and others seeing drops.
The Money Saving Expert (MSE) website explained: “Essentially, a council tax account will be in credit if you’ve paid more than you owe at any point. Normally, this isn’t a problem – in fact, as council tax is usually paid in advance, you’ll often be in credit. However, when an account is closed while in credit, which can happen if you move to another area, for example, this can be an issue.”
The cause of overpayments of council tax is typically relocations, as they require payment in 10 instalments. For instance, if your payments span April to March, yet you relocate in mid-February, it’s probable you’ve contributed excess funds for a month and half.
MSE added: “Councils will often automatically give you a refund before closing your account. But if yours doesn’t and you don’t reclaim, it’ll be closed in credit.”
People may have credit towards their council tax due to forgetting to stop their Direct Debit upon moving, resulting in continued payments on homes they’ve vacated. Those who have had their premises’ council tax band lowered are also sometimes owed refunds.
MSE said: “The vast majority of councils that do try to refund credit tell us they can’t if you paid by any method other than Direct Debit – for example, if you paid by cash, standing order or cheque.”
Certain residents may also be entitled to a reduction or even full exemption from council tax.
