Legalize / United Kingdom / Scotland / Scottish-Statutory-Instrument

The Council Tax Reduction (Scotland) Regulations 2012

Type Scottish-Statutory-Instrument

Publication 2012-11-07

State In force

Jurisdiction Scotland

Department King's Printer for Scotland

Source legislation.gov.uk

Reform history JSON API PDF

Made: 7th November 2012

Laid before the Scottish Parliament: 9th November 2012

Coming into force: 28th January 2013

The Scottish Ministers make the following Regulations in exercise of the powers in sections 80 and 113(1) and (2) of, and paragraph 1 of Schedule 2 to, the Local Government Finance Act 1992 and all other powers enabling them to do so.

PART 1 — General

Citation and commencement

1

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Interpretation

2

(1) ...

“the 1992 Act” means the Social Security Contributions and Benefits Act 1992 ;

“local authority” in Scotland means a council constituted by section 2 of the Local Government etc. (Scotland) Act 1994 ;

“self-employed earner” has the meaning given by section 2(1)(b) of the 1992 Act (categories of earners);

“voluntary organisation” means a body, other than a public or local authority, the activities of which are carried on otherwise than for profit;

(2) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

(3) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

(4) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

(5) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

(6) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

(7) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

(8) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

(9) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Non-dependants

3

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Young persons

4

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Occupation of a dwelling as a home

5

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Remunerative work

6

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PART 2 — Families

Entitlement of only one member of a family

7

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Couples: polygamous marriages

8

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Applicant in receipt of income-related benefit

9

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Responsibility for another person

10

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Membership of a household

11

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PART 3 — Application of the Regulations

Application

12

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Prescribed years

13

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PART 4 — Entitlement to council tax reduction

Conditions of entitlement to council tax reduction

14

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Persons not entitled to council tax reduction: absentees

15

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Persons not entitled to council tax reduction: absentees

16

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Persons treated as being in Great Britain

17

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Temporary absence from Great Britain

18

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Persons not entitled to council tax reduction: persons subject to immigration control

19

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Persons not entitled to council tax reduction: persons subject to immigration control

20

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PART 5 — Applicable amount

Applicable amount

21

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Applicable amount: polygamous marriages.

22

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Applicable amount: persons who have an award of universal credit

23

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PART 6 — Income and capital

CHAPTER 1 — General

Calculation of income and capital of members of applicant's family and of a polygamous marriage

24

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Circumstances in which capital and income of non-dependant is to be treated as applicant's

25

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CHAPTER 2 — Income and capital where there is an award of universal credit

Calculation of income and capital: persons who have an award of universal credit

26

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CHAPTER 3 — Income

Calculation of income on a weekly basis

27

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Treatment of child care charges

28

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Average weekly earnings of employed earners

29

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Average weekly earnings of self-employed earners

30

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Average weekly income other than earnings

31

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Calculation of average weekly income from ... tax credits

32

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Calculation of weekly income

33

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CHAPTER 4 — Employed earners

Earnings of employed earners

34

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Calculation of net earnings of employed earners

35

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CHAPTER 5 — Self-employed earners

Earnings of self-employed earners

36

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Calculation of net profit of self-employed earners

37

(1) For the purposes of regulation 30 (average weekly earnings of self-employed earners) the earnings of an applicant to be taken into account are—

(a) in the case of a self-employed earner who is engaged in employment on that earner's own account, the net profit derived from that employment;

(b) in the case of a self-employed earner whose employment is carried on in partnership or is that of a share fisherman within the meaning of the Social Security (Mariners' Benefits) Regulations 1975 , that earner's share of the net profit derived from that employment, less—

(i) an amount in respect of income tax and social security contributions payable under the 1992 Act calculated in accordance with regulation 38 (deduction of tax and contributions for self-employed earners); and

(ii) one-half of the amount calculated in accordance with paragraph (11) in respect of any qualifying premium.

(2) Any sum, where applicable, specified in Schedule 3 is to be disregarded when calculating a self-employed earner's net profit.

(3) For the purposes of paragraph (1)(a) the net profit of the employment is, except where paragraph (9) applies, to be calculated by taking into account the earnings of the employment over the assessment period less—

(a) subject to paragraphs (5) to (8), any expenses wholly and exclusively incurred in that period for the purposes of that employment;

(b) an amount in respect of—

(i) income tax; and

(ii) social security contributions payable under the 1992 Act; and

(4) For the purposes of paragraph (1)(b) the net profit of the employment is to be calculated by taking into account the earnings of the employment over the assessment period less, subject to paragraphs (5) to (8), any expenses wholly and exclusively incurred in that period for the purposes of the employment.

(5) Subject to paragraph (6), no deduction is to be made under paragraph (3)(a) or (4), in respect of—

(a) any capital expenditure;

(b) the depreciation of any capital asset;

(d) any loss incurred before the beginning of the assessment period;

(e) the repayment of capital on any loan taken out for the purposes of the employment;

(f) any expenses incurred in providing business entertainment; or

(g) any debts, except bad debts proved to be bad, but this sub-paragraph does not apply to any expenses incurred in the recovery of a debt.

(6) A deduction is to be made under paragraph (3)(a) or (4) in respect of the repayment of capital on any loan used for—

(a) the replacement in the course of business of equipment or machinery; and

(b) the repair of an existing business asset except to the extent that any sum is payable under an insurance policy for its repair.

(7) The relevant authority is to refuse to make a deduction in respect of any expenses under paragraph (3)(a) or (4) where it is not satisfied given the nature and the amount of the expense that it has been reasonably incurred.

(8) For the avoidance of doubt—

(a) a deduction is not to be made under paragraph (3)(a) or (4) in respect of any sum unless it has been expended for the purposes of the employment;

(b) a deduction is to be made under paragraph (3)(a) or (4) in respect of—

(i) the excess of any value added tax paid over value added tax received in the assessment period;

(ii) any income expended in the repair of an existing business asset except to the extent that any sum is payable under an insurance policy for its repair; and

(iii) any payment of interest on a loan taken out for the purposes of the employment.

(9) Where an applicant is engaged in employment as a child minder the net profit of the employment is to be one-third of the earnings of that employment, less—

(a) an amount in respect of—

(i) income tax; and

(ii) social security contributions payable under the 1992 Act;

calculated in accordance with regulation 38 (deduction of tax and contributions of self-employed earners); and

(b) one-half of the amount calculated in accordance with paragraph (11) in respect of any qualifying premium.

(10) For the avoidance of doubt where an applicant is engaged in employment as a self-employed earner and is also engaged in one or more other employments as a self-employed or employed earner any loss incurred in any one of those employments is not to be offset against earnings in any other of the applicant's employments.

(11) The amount in respect of any qualifying premium is to be calculated by multiplying the daily amount of the qualifying premium by the number equal to the number of days in the assessment period, and for the purposes of this regulation the daily amount of the qualifying premium is to be determined—

(a) where the qualifying premium is payable monthly, by multiplying the amount of the qualifying premium by 12 and dividing the product by 365; and

(b) in any other case, by dividing the amount of the qualifying premium by the number equal to the number of days in the period to which the qualifying premium relates.

(12) In this regulation “qualifying premium” means any premium which is payable periodically in respect of a personal pension scheme and is payable on or after the date of the application.

Deduction of tax and contributions of self-employed earners

38

(1) The amount to be deducted in respect of income tax under regulation 37(1)(b)(i), (3)(b)(i) or (9)(a)(i) (calculation of net profit of self-employed earners) is to be calculated on the basis of the amount of chargeable income and as if that income was assessable to income tax at the basic rate of tax applicable to the assessment period less only the personal relief to which the applicant is entitled under section 35(1) of the Income Tax Act 2007 (personal allowance for those aged under 65) as is appropriate to the applicant's circumstances, but, if the assessment period is less than one year the earnings to which the basic rate of tax is to be applied and the amount of the personal reliefs deductible under this paragraph are to be calculated on a pro rata basis.

(2) The amount to be deducted in respect of social security contributions under regulation 37(1)(b)(i), (3)(b)(ii) or (9)(a)(ii) is the total of—

(a) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

(b) the amount of Class 4 contributions (if any) which would be payable under section 15 of the 1992 Act (Class 4 contributions recoverable under the Income Tax Acts) at the percentage rate applicable to the assessment period on so much of the chargeable income as exceeds the lower limit but does not exceed the upper limit of profits and gains applicable for the tax year applicable to the assessment period, but if the assessment period is less than one year those limits are to be reduced pro rata.

(3) In this regulation “chargeable income” means—

(a) except where sub-paragraph (b) applies, the earnings derived from the employment less any expenses deducted under regulation 37(3)(a) or, as the case may be, (4); and

(b) in the case of employment as a child minder, one-third of the earnings of that employment.

CHAPTER 6 — Other income

Calculation of income other than earnings

39

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Capital treated as income

40

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Notional income

41

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CHAPTER 7 — Capital

Capital limit

42

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Calculation of capital

43

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Disregard of capital of child and young person

44

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Income treated as capital

45

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Calculation of capital in the United Kingdom

46

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Calculation of capital outside the United Kingdom

47

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Notional capital

48

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Diminishing notional capital

49

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Capital jointly held

50

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Calculation of tariff income from capital

51

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PART 7 — Students

CHAPTER 1 — General

Interpretation: students

52

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Treatment of students

53

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CHAPTER 2 — Income

Calculation of grant income

54

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Calculation of covenant income where a contribution is assessed

55

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Covenant income where no grant income or no contribution is assessed

56

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Relationship with amounts to be disregarded under Schedule 4

57

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Other amounts to be disregarded

58

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Treatment of student loans

59

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Treatment of fee loans

60

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Treatment of payments from access funds

61

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Disregard of contribution

62

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Further disregard of student's income

63

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Income treated as capital

64

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Disregard of changes occurring during summer vacation

65

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PART 8 — Amount of reduction

Maximum council tax reduction

66

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Non-dependant deductions

67

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Extended council tax reduction

68

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Duration of period of entitlement to extended council tax reduction

69

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Amount of extended council tax reduction

70

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Extended council tax reduction: movers

71

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Relationship between council tax reduction and extended council tax reduction

72

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Extended council tax reduction (qualifying contributory benefits)

73

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Duration of extended council tax reduction (qualifying contributory benefits)

74

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Amount of extended council tax reduction (qualifying contributory benefits)

75

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