Two-thirds of councils are giving vulnerable people incorrect information about council tax discounts, an investigation has revealed.
New research by MoneySavingExpert.com found up to 100,000 people - including those diagnosed as ‘severely mentally impaired’ - are missing out on a 25% council tax discount.
Through a mystery shopping exercise and freedom of information requests, the website found a council tax postcode lottery was leading to the most vulnerable people being overcharged by up to £400 a year.
Only a quarter of councils provided advice on council tax discounts that was completely correct.
Martin Lewis, founder of MoneySavingExpert.com, said: ‘In some council areas the number of people actually receiving the discount is paltry. As councils don’t actually lose money from this – it’s funded by central Government – it’s tough not to think the cause is just mass council ineptitude in administering it.
‘Local councils need to urgently review their processes in order to reduce the amount of misinformation given out by frontline staff. They could also help by proactively communicating the discount in their standard literature.'
Mr Lewis added: 'There should be an urgent review by central and devolved government of how local councils are applying the SMI discount, including setting up a standardised procedure, with one form, to make it easy to claim, regardless of postcode.’
A Department for Communities and Local Government spokesman said: 'The law is clear that where people are severely mentally impaired, their council tax bill should take account of this. We expect all local councils to make sure that people entitled to this support receive it.'
