Council Tax Reduction Consultation 2026

Proposal: To disregard an amount equivalent to the lower rate of Limited Capability for Work Related Activity (LCWRA) (currently £217.26 a month or £50.14 a week) when working out a person’s income where they or their partner get the LCW or LCWRA element in their Universal Credit

This proposal relates to increasing support for disabled people on Universal Credit who get the LCW or LCWRA elements by ignoring an amount of their Universal Credit when working out their weekly income.

For example, a single person with a weekly income of £200 including income from LCW or LCWRA in their Universal Credit would currently get a 25% discount. Under this proposal, we would calculate their income to be £149.86 (£200 less £50.14), and they would now get a 50% discount.

This proposal by itself would increase the cost to the Council. The funding for this change would come from changes we are proposing in Parts 3 to 8. However, if we adopt all or some of these proposals, it is expected all working age applicants of CTR not getting the LCW or LCWRA elements in their Universal Credit would have to pay more Council Tax.

Please click on the Glossary below for definitions.

Glossary Glossary

Couple

Two people who are married, civil partners, or living together as if married or civil partners. Their income and capital are assessed jointly.

Discount Scheme / Banded Scheme

The working-age CTR scheme adopted by Somerset Council. Household income is compared against predefined weekly income bands, with fixed percentage reductions (100%, 50%, 25%, 10% or 0%) awarded accordingly.

Disregard

A disregard is something we ignore or don’t take into account.

Household

The applicant, partner, and any children or young persons treated as members of the same household for CTR assessment purposes.

Income

All money received by the applicant or partner, including earnings, benefits, pensions, tax credits, and notional income, subject to extensive disregard rules in Schedule 2.

Limited Capability for Work (LCW) - Universal Credit (UC)

A Universal Credit status given to a claimant whose health condition or disability significantly limits their ability to work at present, but who may be able to prepare for work in the future.

Claimants with Limited Capability for Work are not required to look for work, but may still be expected to take part in work related activities where appropriate.

Limited Capability for Work and Work‑Related Activity (LCWRA)

A Universal Credit status given to a claimant whose health condition or disability severely limits their ability to work and to take part in work‑related activities, as assessed through a Work Capability Assessment.

Claimants assessed as having Limited Capability for Work and Work‑Related Activity:

are not required to work, and

are not required to prepare for work or undertake work‑related activities.

LCWRA normally includes an additional Universal Credit amount to recognise the impact of severe or long‑term illness or disability on a claimant’s ability to work.

Non-dependant

An adult living in the household who is not a partner or dependent child. A standard non-dependant deduction reduces the CTR award.

Pensioner / Pension-age Applicant

A person who has attained the qualifying age for State Pension Credit and is not in receipt of Universal Credit or other working-age benefits.

Transitional Protection - Universal Credit

A form of temporary financial protection applied when a claimant moves from older ‘legacy’ benefits to Universal Credit as part of the Government’s managed migration process.

If the claimant’s Universal Credit award would otherwise be lower than their previous benefits at the point of transfer, an additional amount (known as a transitional element) is included so they are not worse off at the point of migration.

Transitional Protection:

applies only in specific circumstances (mainly managed migration),

reduces over time as other elements of Universal Credit increase or circumstances change, and

is not a permanent entitlement.

Universal Credit (UC)

A means-tested benefit administered by DWP. UC award data may be used directly by the Council to calculate income and capital for CTR.

Working-age Applicant

An applicant who has not reached State Pension Credit age, or who has but is in receipt of Universal Credit or working-age benefits, and is therefore assessed under the local banded scheme.

Part 1

Glossary Glossary