Coventry Council Tax Non-Dependant Deductions and Savings Rules

What Non-Dependant Deductions Are

A non-dependant is any adult (aged 18+) living in your home who isn't your partner, doesn't pay you rent on a commercial basis, and isn't legally disregarded for council tax (like someone with severe mental impairment). Adult children, siblings, elderly parents, or friends staying in your household usually count.

The council assumes non-dependants contribute toward the household's council tax. A fixed weekly deduction is taken from your eligible council tax liability before your Council Tax Support percentage is applied. The amount depends on the non-dependant's gross weekly income — higher earners trigger larger deductions.

This means having an earning adult in your home can reduce your Council Tax Support even if they don't actually contribute to your bills.

When No Deduction Applies

No non-dependant deduction is made if you or your partner receives:

• The care component of Disability Living Allowance (any rate)
• The daily living component of Personal Independence Payment (any rate)
• Attendance Allowance

If any of these apply, non-dependants are ignored entirely in your CTS calculation, regardless of their income. This is a significant protection for disabled households.

Non-dependants who are full-time students, under 18, or receiving certain qualifying benefits may also have a nil deduction applied.

The Capital and Savings Rules

Coventry applies a hard capital limit of £16,000 for working-age applicants. If your household's total savings, investments, bank balances, stocks, and non-primary property exceed this figure, you're excluded from Council Tax Support entirely. There's no taper — it's a cliff edge.

Under £6,000: Capital is fully ignored. It has no effect on your assessment.

£6,000 to £16,000: A "tariff income" of £1 per week for every £250 (or part of £250) above £6,000 is added to your weekly income. For example, savings of £10,000 generate a tariff income of £16 per week (£4,000 ÷ £250 = 16). This can push you into a higher income band and reduce your support.

Excluded from the count: Personal injury compensation held in trust, statutory redress payments, and the value of your main home.

Pension-age applicants who receive Guarantee Pension Credit are exempt from the capital limit altogether. All other pension-age residents face the same £16,000 ceiling.

Earnings Disregards by Household Type

Before calculating your excess income, the council subtracts a fixed weekly disregard from your net earned income. The disregard amount depends on your household type:

The scheme lists different disregard amounts by household classification. If more than one category fits your household, check with the Benefits team which amount applies.

Net earned income means gross pay minus income tax, National Insurance, and 50% of any voluntary personal or occupational pension contributions. The disregard comes off after those deductions.

Self-Employment Rules

Self-employed applicants are assessed on gross profit minus allowable operational expenses. The council does not accept depreciation or entertainment expenses as deductions — these are disallowed for CTS purposes, even though HMRC may allow them on your self-assessment.

If you're a registered childminder, special provisions apply that can reduce your assessed self-employment income. Ask the Benefits team for details.

You'll need to provide audited profit and loss accounts or the council's own Certificate of Earnings Form when applying.

How These Rules Work Together

Here's how the pieces connect in a real calculation:

1. Your gross council tax liability is reduced by any statutory discounts
2. Non-dependant deductions are subtracted from that figure
3. The result is your net eligible liability
4. Separately, your total household income is calculated (wages + benefits + tariff income from capital)
5. Earnings disregards are subtracted from earned income
6. Your applicable amount is subtracted from total income to find excess income
7. Excess income determines your band (1–5) and the percentage of net eligible liability the council covers

Getting any one of these wrong changes the outcome. The Coventry Council Tax Reduction guide walks through each step with a printable worksheet, so you can verify the council's calculation on your decision notice.

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