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Council tax deductions from benefits

If you get certain benefits, a council can ask the DWP to take council tax arrears from them. It is slow, but it adds no bailiff fees — which is why some people ask for it.

Applies to: England & Wales

Written by The My Debt Cleared editorial teamLast reviewed 18 October 2026Next review 18 April 2027Jurisdiction England & WalesEditorial policy
After a liability order, a council can ask the DWP to deduct council tax arrears from Universal Credit, Pension Credit, income-based Jobseeker’s Allowance, income-related Employment and Support Allowance or Income Support. From Universal Credit the deduction is usually 5% of your standard allowance, and DWP policy caps most deductions at 15% of the standard allowance in total.

What to do now

  1. Check your Universal Credit statement or benefit letter for the deduction.
  2. If total deductions leave you short, ask the DWP to reduce them.
  3. If enforcement agents are involved, ask the council about deductions from benefits instead.

How it starts

The council must first get a liability order from the magistrates’ court. It then applies to the DWP, which decides whether to make the deduction. Your consent is not needed. You should get a letter or a note on your Universal Credit statement showing the deduction.

How much is taken

  • Universal Credit: usually 5% of your standard allowance each month.
  • Older benefits such as Pension Credit or income-based Jobseeker’s Allowance: a fixed weekly amount set each year.

Universal Credit can have deductions for up to three different third-party debts at once, such as council tax, rent or energy arrears. Regulations allow higher totals, but DWP’s current policy limits total deductions to 15% of the standard allowance. Your budget should reflect the reduced payment.

Why some people ask for it

Deductions from benefits add no enforcement agent fees, unlike bailiff action, which adds fees at each stage — council tax bailiffs. If you are on a qualifying benefit and a council has passed your debt to enforcement agents, you can ask it to recall the case and apply for deductions instead. The council does not have to agree, but many will consider it, especially where you are vulnerable or on a low income.

If it causes hardship

  1. Add up every deduction on your statement, not just council tax.
  2. Ask the DWP to reduce the deductions, explaining the hardship.
  3. If you disagree with a Universal Credit deduction decision, you can ask for a mandatory reconsideration and then appeal to a tribunal.
  4. Ask the council about Council Tax Reduction, which lowers the ongoing bill, and a section 13A reduction for the arrears.

Breathing Space and formal solutions

Breathing Space does not pause deductions already being taken from Universal Credit, though creditors must tell the DWP so that deductions from older benefits for a covered debt can be paused. A DRO, IVA or bankruptcy can deal with the arrears — council tax in formal solutions. What Breathing Space covers.

The current bill

Deductions pay off arrears. The current year’s council tax still has to be paid, or new arrears build up and the process starts again. Check Council Tax Reduction for the ongoing bill.

You can get free, impartial debt advice

You never have to pay for debt advice. MoneyHelper (government-backed), StepChange, National Debtline and Citizens Advice all give free, confidential advice with no obligation.

Common questions

Can council tax be taken from Universal Credit?

Yes, after the council gets a liability order. The deduction is usually 5% of your standard allowance, within an overall cap on deductions.

Can I ask for council tax to be taken from my benefits instead of bailiffs?

You can ask. The council does not have to agree, but deductions from benefits add no enforcement agent fees, so it is worth asking if you are on a qualifying benefit.

Does Breathing Space stop council tax deductions from Universal Credit?

No. Deductions already being taken from Universal Credit are not covered by Breathing Space and carry on.

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