Sandwell Council Tax Reduction Savings Limit — The £3,000 Capital Rule

The £3,000 Threshold

Before April 2025, Sandwell used the standard £16,000 capital limit that most councils apply. As part of the same package that introduced the 85% award cap and Band B restriction, the council slashed the working-age capital limit to £3,000.

The rule is binary. If you and your partner hold combined capital above £3,000, you are entirely ineligible for Council Tax Reduction unless you fall into a protected category. It doesn't matter if your income is zero. There's no taper — no reduced award for having £3,100 versus £15,000. You're either at or below the limit or you're out.

The separate pension-age scheme has a £16,000 capital limit; for working-age applicants, the operative number is £3,000 unless they fall into a protected category.

What Counts as Capital

The council assesses everything with a realisable cash value:

• Bank accounts — current accounts, savings accounts, credit union balances
• Cash ISAs and investment ISAs — valued at current market rates
• Shares and stocks — market value less any costs of selling
• Second properties or land — market value less outstanding mortgages and legal costs
• Premium Bonds — face value
• Money owed to you — if the debt is enforceable

Both your assets and your partner's are combined. If you hold £1,800 and your partner holds £1,300, the total is £3,100 — over the limit.

What Doesn't Count

These are excluded from the capital assessment:

• Your main home — the property you live in and pay council tax on
• Personal belongings — furniture, clothing, household goods, a car
• Pension funds — approved personal or occupational pension schemes you haven't accessed
• Surrendered life insurance policies
• Some benefit arrears — specified income-related benefits, including income-based JSA and income-related ESA, plus some tax-credit arrears, may be disregarded for 52 weeks; other arrears may be treated differently

The exclusion list matters because some assets that feel like wealth aren't counted. A car worth £5,000 is personal belongings. A workplace pension worth £40,000 is disregarded. But £3,100 in a savings account disqualifies a non-protected working-age claimant.

Practical Situations

Redundancy pay or a settlement: If you receive a lump sum that pushes you over £3,000, you become ineligible from the date the money hits your account. If you spend it down on legitimate living costs below the threshold, you can reapply. The council will want to see bank statements covering the drawdown.

Inheritance: A bequest that lands in your account is assessed as capital. If probate is pending and the money hasn't been released, it may not yet count — but the moment it's accessible, it does.

Joint accounts: The council splits joint accounts equally between account holders unless you can prove an unequal beneficial ownership (unusual for household joint accounts).

Pension-Age Claimants Are Different

If you've reached State Pension Credit age, the capital limit is £16,000 — or unlimited if you receive Guarantee Pension Credit. Pension-age rules are set nationally and Sandwell can't change them. This only matters for mixed-age couples: if you're both working-age, the £3,000 limit applies regardless.

Proving Your Capital

Sandwell requires two full consecutive months of bank statements for all accounts held — by you and your partner — when total capital exceeds £1,000. The council also has access to open-banking statement uploads through the MySandwell portal for electronic verification.

If you hold accounts in different banks, gather statements from all of them. A missed account doesn't speed things up — it stalls the 20-working-day processing clock until the evidence arrives.

For a full evidence checklist and step-by-step guidance on the capital assessment, see the Sandwell Council Tax Reduction guide.

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