Council Tax - Determination of Tax Base

AGENDA ITEM 8

BOROUGH OF POOLE

CABINET

14 JANUARY 2014

COUNCIL TAX - DETERMINATION OF TAX BASE

PART OF PUBLISHED FORWARD PLAN: YES

STATUS – STRATEGIC POLICY

1. PURPOSE AND POLICY CONTEXT

1.1. The purpose of this report is to show the calculations required in order to determine the tax base for the Borough of Poole for 2014/2015.

1.2.A formal decision must be made in order that the tax base can be notified to the Dorset Police and Crime Commissioner and to Dorset Fire Authority by 31 January 2014.

1.3. The information shown in paragraph 2.1(b) will be used to set the council tax to be levied in 2014/2015. Council tax will be set by Council at its meeting on 25 February 2014.

2. DECISION REQUIRED

2.1. The Cabinet be asked to approve:

(a) The report of the Head of Financial Services for the calculation of the Borough’s tax base for the year 2014/2015;

(b) That pursuant to the Head of Financial Services’ report, and in accordance with the Local Authorities (Calculation of Council Tax Base) (England) Regulations 2012, the amount calculated as the Council Tax Base for the Borough of Poole for the year 2014/2015 shall be 53,933;

NOTE: This decision will be acted upon on the day following Cabinet. It is not subject to call in with the exception of process.

3. DETERMINATION OF TAX BASE

3.1. The first stage in the calculation of the tax base is to determine the relevant amounts. The relevant amount for each council tax band is the measure of the number of dwellings in that band after taking account of exempt dwellings, discounts, premiums, the council tax reduction scheme and allowing for additions. The relevant amount is presented as a band D equivalent number. The tax base is the number of properties that will pay the equivalent of a full band D charge. The proportion of all properties in relation to band D is shown in Appendix A.

The actual calculations of the relevant amounts required for each band, is presented and described in Appendix A. In summary, the totals of these are:

Band Relevant Amount A 1,626 B 6,088 C 15,676 D 10,420 E 8,795 F 5,254 G 4,824 H 1,740 Total of Relevant Amounts 54,423

3.2. The Local Authorities (calculation of Council Tax Base) Regulations 2012 prescribe how the calculations should be made. In essence, the formula for the calculation of the tax base is:

(a) the total of the relevant amounts for the year, 54,423

MULTIPLIED BY

(b) the estimated collection rate

Estimated Collection Rates:

“Collection rate” is the billing authority’s estimate of the total amounts in respect of its Council Taxes for the year which will be ultimately paid. In considering the rate that was set for 2013/14 regard was taken of both the significant changes to the population that will be liable for council tax and to the continuing economic pressures. This resulted in us reducing the rate to 99.0%. In year monitoring indicates that collection rates are still good and therefore a minor adjustment is recommended for 2014/15.

It is recommended that the rate is set at 99.1% for 2014/2015.

3.3 Tax Base:

(a) The Council Tax Base for the Borough of Poole is therefore recommended to be 54,423 x 99.1% = 53,933

ADAM RICHENS

2 CHIEF FINANCE OFFICER AND HEAD OF FINANCIAL SERVICES

BACKGROUND PAPERS Nil Name and Telephone Number of Officer Contact Mandy May, 01202-633178

APPENDIX A

The Relevant Amount

1. The relevant amount for each council tax band is a measure of the number of dwellings in that band after taking account of exempt dwellings and discounts.

2. The resultant figures are then multiplied by the proportion which that band bears to band D. (Appendix B)

3. The legislation is prescriptive in how the relevant amount for each band should be calculated. A brief summary of this is described below.

a) the number of chargeable dwellings in 30 November 2013 valuation list less the authority’s estimate of the number of such dwellings which were exempt on that day.

ADJUSTED FOR

b) the estimated number of disabled person’s relief reductions moving to the next lower band below during 2014/2015, as amended by The Local Authorities (Calculation of Tax Base) (Amendment) (England) Regulation 1999.

c) the factor to take account of the discounts to which the amount of council tax payable was subject on the 30 November 2013.

d) the factor to take account of premiums, if any.

e) is the amount of any adjustment in respect of changes in the number of chargeable dwellings, discounts or premiums and is expressed as the estimated net additions to the list between 30 November 2013 and 31 March 2015

LESS f) the total amount that is estimated to be applied in accordance with the authority’s council tax reduction scheme in relation to the band, expressed as an equivalent number of chargeable dwellings in that band

4 APPENDIX A Band A entitled to disabled relief Band A Band C Band D Band F Band G TOTAL reduction Column 1 Column 2 Column 4 Column 5 Column 7 Column 8 COLUMN 10 1 Total Number of dwellings on the 11,939 22,556 8,017 3,929 3,08 933 67,330 Valuation List 30 November 2013 1 2

2 Number of dwellings on valuation 171 396 91 44 2 17 1,082 list with exemption 1 7

3 Number of demolished dwellings 0 0 0 0 0 0 and dwellings outside area of 0 0 authority

4 Number of chargeable dwellings 11,768 22,160 7,926 3,885 3,05 916 66,248 (treating demolished dwellings etc 1 5 as exempt) (lines 1-2-3)

5 Number of chargeable dwellings in 37 129 53 37 2 32 407 line 4 subject to disabled reduction 8 7

6 Number of dwellings effectively 10 129 82 37 27 3 0 407 subject to council tax for this band 5 2 by virtue of disabled relief (line 5 after reduction)

7 Number of chargeable dwellings 10 11,860 22,113 7,910 3,875 3,060 884 66,248 adjusted in accordance with lines 5 1 and 6 (lines 4-5+6 or in the case of column 1, simply line 6)

8 Number of dwellings in line 7 6 5,448 6,531 1,832 777 568 102 21,641 entitled to a 25% discount 3

9 Number of dwellings in line 7 0 120 250 51 28 9 2 586 entitled to a 25% discount due to all 1 but one resident being disregarded for council tax purposes 10 Number of dwellings in line 7 0 6 18 6 15 25 4 104 entitled to a 50% discount due to all 2 residents being disregarded for council tax purposes. 11 Number of dwellings in line 7 0 119 258 295 267 354 149 1,733 classed as second homes. (100% 2 chargeable) APPENDIX A Band A Band B Band C B Band E Band F Band Band H TOTAL entitled to Column 3 Column 4 Ca Column 6 Column 7 G Column 9 COLUMN disabled o Colu 10 relief mn 8 reduction Column 1 12 Number of dwellings in line 7 0 180 220 62 51 63 29 814 classed as long-term empty and 1 receiving zero % discount.

13 Number of LTE liable for 50% 21 27 16 11 10 6 132 premium 2 14 Number of dwellings in line 7 4 6,286 15,314 6,021 3,055 2,4 776 43,917 assumed to be entitled to no 8 58 discounts (paying 100%) (Line 7 – Lines 8,9 and 10) 15 Number of dwellings in line 7 6 5,574 6,799 1,889 820 60 108 22,331 assumed to be subject of a discount 3 2 (Lines 8+9+10) 16 Number due to council tax reduction 2 2,667 2,797 248 59 28 1 8,028 scheme 7 17 Total number of dwellings after 6 7,808 17,626 7,196 3,612 2,880 858 52,677 discounts, exemptions and disabled 1 relief (line 8 x 0.75) + (line 9 x 0.75) + (line 10 x 0.5) + (line 13 x 0.5) +line 14 – line 16) 18 Ratio to band D 5/9 7/9 8/9 11/9 13/9 15/9 18/9 9 19 Number of band D equivalents (line 4 6,073 15,667 8,795 5,218 4,800 1,716 54,154 15 x line 16) 1 20 Number of band D equivalents of 156 contributions in lieu (in respect of 1 Class O exempt dwellings)

21 Estimated net number of additions 0 15 9 0 37 23 24 113 2 286.8

22 Total of relevant amounts 4 6,088 15,676 8,795 5,254 4,824 1,740 54,423 1 23 Assumed collection of 99.1% = Tax 53,933 Base

APPENDIX B

BOROUGH OF POOLE

BAND PROPORTIONS

BAND VALUES PROPORTION RELATIONSHIP (£000) TO BAND D

A Up to 40 6 6/9 B 40-52 7 7/9 C 52-68 8 8/9 D 68-88 9 9/9 E 88-120 11 11/9 F 120-160 13 13/9 G 160-320 15 15/9 H 320 + 18 18/9 ie: band A properties pay 6/9 of band D properties. band H properties pay twice the amount payable by band D properties.