Tower Hamlets Council Tax Hardship Fund and Cost of Living Relief Fund 2026/27
Tower Hamlets runs two other council tax relief schemes alongside the main Council Tax Reduction. They cover different situations and different income bands — and getting them confused is one of the most common problems residents face.
The Section 13A Hardship Fund
Under Section 13A(1)(c) of the Local Government Finance Act 1992, Tower Hamlets can reduce anyone's council tax liability by whatever amount it sees fit. In practice, this discretionary power funds an Exceptional Financial Hardship scheme for residents facing severe, unforeseen financial pressure.
Who it is for: anyone with an active council tax liability who can demonstrate severe, exceptional hardship caused by unforeseen events or a structural budget deficit. It is not a universal top-up. The council decides case by case.
How to apply: through the dedicated "Council Tax Section 13a Application" on the Tower Hamlets website. You must explain your circumstances and provide evidence of the hardship. Awards are temporary bill credits, not ongoing entitlements.
Key distinction: the hardship fund is completely separate from main CTR and from Discretionary Housing Payments (which cover rent, not council tax).
The Council Tax Cost of Living Relief Fund
This is the Mayoral scheme that confuses people most. For 2026/27, the Mayor in Cabinet raised the household income ceiling from £50,350 to £60,000.
Eligibility requirements:
- Named on a Tower Hamlets council tax bill
- Not receiving main Council Tax Reduction
- Total gross household income under £60,000 per year
- Combined household savings under £16,000
- Resident in Tower Hamlets and named on the bill since before 1 April 2024
Award amounts by band (2026/27):
| Band | Full rate (per year) | With 25% SPD |
|---|---|---|
| A | £72.15 | £54.11 |
| B | £83.99 | £62.99 |
| C | £96.37 | £72.28 |
| D | £107.91 | £80.93 |
| E | £132.44 | £99.33 |
| F | £156.14 | £117.11 |
| G | £180.37 | £135.28 |
| H | £216.23 | £162.17 |
The Common Confusion
The £6,000 capital limit applies to main CTR. The £16,000 capital limit applies to the Cost of Living Relief Fund. The £60,000 income ceiling also applies only to the Relief Fund. Search engine snippets regularly mix these up, leaving residents unsure which scheme they qualify for.
The schemes use different tests. Main CTR assesses income against your household's applicable amount and applies the £6,000 working-age capital limit; income above the applicable amount may still qualify for a tapered award. If you receive main CTR, you cannot also receive the Relief Fund. If you do not receive CTR but your household income is under £60,000, check whether the Relief Fund applies.
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Which Should You Apply For?
If you may qualify for main CTR, apply for that first: it can cover up to 100% of your eligible liability. If you do not receive CTR, check whether the Relief Fund applies. The two cannot overlap.
For residents facing arrears or enforcement action, neither fund is the right route — contact StepChange (0800 138 1111) or National Debtline (0808 808 4000) for free debt advice.
The Tower Hamlets Council Tax Reduction Guide covers both schemes with eligibility flowcharts and worked examples for households in the overlap zone.
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