Council has tonight endorsed recommendations to change the Council Tax Reduction Scheme for working-age households from 1 April 2026.
The changes will make the scheme more generous, supporting the 17,000 households that currently access Council Tax reduction support.
The changes include replacing the current complex means-tested scheme with a simplified earnings-based banded scheme with an increase in the maximum award from 80% to 84% and introduces measures to improve financial stability for residents.
The changes will help to simplify the scheme, improve take-up, provide additional support for low-income households, and reduce the administrative costs of running the scheme
The changes will not affect the Council Tax Reduction Scheme for pension age applicants which is prescribed by Government. Pension age households in Knowsley will continue to receive up to 100% discount on their Council Tax bill dependent on household composition and financial circumstances.
The changes approved are:-
- Increase the maximum award from 80% to 84%, making it one of the most generous across the Liverpool City Region.
- Introduce an earnings based banded scheme which incorporates household composition.
- Introduce a cap on household’s assessed Council Tax liability at Band C.
- Increase non-dependant deductions to £4 (not in employment) and £10 per week (employed).
- Introduce a minimum award value of £3 per week.
- Income changes of less than £3 per week will not trigger a re-assessment of Council Tax Reduction.
- Backdate awards in exceptional circumstances of up to 12 months.
- Households moving from benefits into paid employment will not transition out of Band 1 until the following financial year.
Cllr Jayne Lonergan, Cabinet Member for Resources, said “These changes have been approved following extensive consultation and the proposed changes were overwhelmingly supported.
“Under this new scheme, it will be much easier for residents to understand the level of support they are entitled to, which in turn will help to maximise uptake and support a larger proportion of the Borough’s low-income households.
“Importantly, the changes mean that the scheme will increase uptake and place money in the pockets of residents who need it most.”
The new scheme will be implemented from 1 April 2026.