Martin Lewis warns 400,000 people are in wrong council tax band and could be owed thousands
People cannot ask for their band to be lowered, rather, they can only challenge the band
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Martin Lewis has warned hundreds of thousands of people are in the wrong tax band, and they could be owed thousands back in overpaid council tax.
The money saving expert, who has been campaigning about the issue since 2007, said 400,000 are estimated to be in the wrong council tax band.
Speaking on BBC Radio 5Live’s The Martin Lewis Podcast, he said: “Everybody should check their council tax band and if it’s wrong, you should challenge it.”
The financial journalist explained there are two checks he suggests people make.
Martin Lewis has warned hundreds of thousands of people are in the wrong tax band
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He said: “Check number one – the one that matters most – is what I call the neighbours check.
“The question is quite simple. Is your band higher than your neighbours’ in a similar or preferably identical property?”
Mr Lewis, who is the founder of Money Saving Expert, said most council tax bands in England can be found on Gov.uk, and Saa.gov.uk in Scotland.
He added: “You can check your band and it’s an open list so you can check your neighbours’ bands too.
“But you need to find as close a proxy to your house as you possibly can. The further away it is, both in distance and in size, build and facilities, the further away your check is from being a solid check.”
Mr Lewis this is not an official government process, but rather a system he invented back in 2007, to give people a guide on whether it looks as though they may be in the wrong band.
He went on to warn people cannot ask for their band to be lowered, rather, they can only challenge the band. This could lead to the challenger’s band – and even their neighbours’ bands – moving up instead of down.
Mr Lewis said: “You can say you think the bands are wrong so can they assess your bands.”
He explained that it could therefore be “perfectly possible” that if a person’s band is higher than neighbours’ bands who live in identical properties, it may be their bands are too low.”
The financial journalist therefore invented a second check, known as the valuation check, to try and give peace of mind that challenging a council tax band wouldn’t lead to the neighbours’ bands going up.
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This sees the person estimate what their home was worth in 1991.
“You want to try and find what a similar or identical property has sold for at market value recently near you – it may be the house you bought.
“Then you need to back convert it into 1991 property values.”
There is a free tool online on the Money Saving Expert website which can do this conversion.
They should then look to see which band they are in.
He said: “I would only look at doing a check and challenge to council tax if you have passed both checks comfortably.”
The Martin Lewis Podcast is available to listen to on BBC Sounds.