When researching where to rent or buy a property in London, there is an array of things to take into account. Council Tax is one factor that is sometimes overlooked- potentially leading to a bit of an unwelcome surprise further down the line. We look into how Council Tax is worked out, along with what the three cheapest London boroughs for Council Tax are.
How is Council Tax calculated?
Council Tax was originally introduced in 1993 by the Local Government Finance Act 1992. The amount of Council Tax you pay is dependent on which band you are in, ranging from A to H. Your band is based upon the value of your property on 1st April 1991 (for England and Scotland). You can challenge this band if you feel that your property is in the wrong one, which would most likely be due to alteration or demolition of part of the property.
Council Tax is also dependent upon the resident of the property, with potential for discounts and exemptions where applicable. For instance, an adult can receive a 25% discount if they are the only adult living in the property.
Cheapest Three London Boroughs for Council Tax
For the below boroughs, we have included details of the Council Tax for a Band D property, which is one of the bands that is midway between the highest and lowest priced properties.
City of Westminster
Perhaps surprisingly, the City of Westminster has the lowest Council Tax rate in London, charging £668.81 per year for a Band D property. Stretching from Covent Garden to St Johns Wood and including the likes of Marylebone and Soho, Westminster might not be the first place you’d look at if you were searching for a home on a budget, but it certainly comes with a fair few privileges.
Council Tax cost (Band D property): £668.81 per year
Transport: Fantastic selection of underground and National Rail stations, including Victoria Station for trains to outside of London.
Amenities: Some of the most prominent attractions in London, including Big Ben, Hyde Park and Buckingham Palace itself. It also comes with an overwhelming range of restaurants, bars, clubs and shops – you really are spoilt for choice.
Wandsworth
South west of the river, Wandsworth offers the second lowest Council Tax rate for inner London at £679.91 per year for a Band D property. The area includes some affordable housing, covering areas such as Tooting Bec and Streatham that have increased in popularity over recent years, as well as more established locations like Putney and Battersea.
Council Tax cost (Band D property): £679.91 per year
Transport: Access to the District Line and Northern Line, as well as National Rail links from Clapham Junction Station that provides fast access to Victoria Station as well as south of London.
Amenities: Expect charming independent cafes, quirky bars and the odd club. The borough has an impressive range of great schools too, and being set further out of the centre of London gives you a bit more breathing space with quiet residential streets and plenty of parkland.
City of London
Known primarily for being the UK’s centre of business and finance, the City of London also offers prestigious accommodation – which is particularly appealing to those working in the area. Not technically classified as a borough, but still being a local authority district, the City of London has the third lowest council tax rate for inner London at £931.20 per year for a Band D property.
Council Tax cost (Band D property): £931.20 per year
Transport: Nearly all of the underground lines run through the City, including the Central, Jubilee and Circle lines, as well as a few prominent stations such as Liverpool Street Station.
Amenities: The City is full of well-known landmarks, including The Gherkin, St Paul’s Cathedral and the Barbican Centre and also borders the River Thames on the south side. Upmarket entertainment is on the cards, with Barbican Theatre, Guildhall Art Gallery and some fine dining venues.
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To find out about the average property prices and more in other areas of London, take a look at our Market Trends page.
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