New council tax exemption could provide vital support – here's how it works

Two councils in England have introduced a 100% discount for council tax for those who are terminally ill.

Manchester City Council introduced the change in the summer, followed by Barnsley last month.

The charity, Marie Curie, has since secured commitments from 16 councils to drop council tax for people at the end of their lives and hopes more will follow. 

Here Which? explains how the discount works, which councils are looking at introducing it and the other types of financial support you could claim if you, or someone you live with, is terminally ill. 

How does the exemption work?

The exemption means households where someone is terminally ill don’t have to pay any council tax for a set period. It’s intended to reduce financial pressure at a difficult time and ensure families aren’t left struggling with bills while caring for someone with a terminal diagnosis.

The councils offering the exemption have different ways of implementing it: 

Manchester City Council

Manchester City Council has updated its Discretionary Council Tax Policy (DCTP) to offer a 100% council tax discount to residents who are terminally ill. To qualify, a person must have a ‘progressive disease’ and a life expectancy of 12 months or less. 

You can apply for the exemption if the person is an adult, child or another dependant in the home. Applicants can claim the exemption online and need to provide an SR1 medical form from their clinician to confirm their condition.

The discount will continue on the household's bill until the date the person dies. The council has said steps are also in place to keep the discount in place for the rest of the financial year to provide additional support to the household afterwards. 

The council is also working to ensure that a ‘tell us once’ protocol is in place. The scheme is expected to help around 175 working-age people in Manchester. 

Barnsley Metropolitan Borough Council

Barnsley’s 100% council tax discount is available to people who have ‘been diagnosed by a registered medical practitioner to have an illness or condition that cannot be cured and is likely to lead to someone’s death’.

To qualify, they have to occupy the property as their sole and main residence to qualify.

Like Manchester’s discount, you can apply online and will need to provide evidence through a completed SR1 form completed by a registered medical professional. 

The discount will begin from the date the SR1 form is issued and will continue until two months after the date of the death of the terminally ill person. 

• Find out more: council tax calculator 2025-26

More councils considering the change

Marie Curie said three councils – Bristol, Salford and Preston – have made firm commitments to introduce 100% council tax relief for people who are terminally ill, with similar schemes expected to go live soon.

A further 11 councils have pledged to explore introducing a dedicated policy, including:

• Newcastle
• Wakefield
• Wirral
• Pendle
• Newark and Sherwood
• South Gloucestershire
• Milton Keynes
• Blackburn with Darwen
• Liverpool
• Burnley 
• Sheffield

Find out more: how to get a council tax reduction or refund

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Extra financial support if you are terminally ill

If you are terminally ill or someone you know is, you can get support with bills through government benefits, grants from charities and help from social services.

1. Benefits

Most people who need care towards the end of their lives qualify for Department for Work and Pensions (DWP) disability benefits.

These include:

• Personal Independence Payment (PIP) – if you’re over 16 and under the state pension age 
• Attendance Allowance – if you’re over state pension age 
• Disability Living Allowance (DLA) – for children under 16
• Adult Disability Payment – if you’re over 16 and under state pension age and live in Scotland
• Child Disability Payment – for children under 16 who live in Scotland

These benefits are not means-tested. This means the amount of money you have does not affect whether you can get the benefit.

You may also be able to apply for:

• Employment and Support Allowance (ESA) - if you are unable to work because you are ill
• Universal Credit -  if you are out of work or on a low income

You can often receive more than one benefit if you are eligible, but there is generally a limit on the total amount you can receive, which is known as the Benefit Cap. 

Although this cap does not apply to everyone, and you are exempt from it if you are claiming a disability benefit, receive the limited capability for work element of Universal Credit or are in the support group for ESA. 

2. Grants

Being diagnosed with an illness can mean you’re able to apply for one-off payments and grants to help with your bills. These are sometimes offered by registered charitable organisations across the UK as well as through local councils and social workers.

Grants can be given as money, products or services that don't have to be paid back. Your eligibility is often based on your personal circumstances. Each fund’s payment methods will be specific to it, and the payment timeframe can range from a few days to a few months. 

You can find what grants could be available to you by using Turn2Us Grant Search. 

All you need to do is answer a few questions, which will detail your personal situation, and the service will match your information to grants that you may be able to apply for. You can then choose which grants you want to apply to. 

If you are terminally ill, you can get energy and water support through the Priority Services Register. This is a free scheme provided by all energy and water suppliers and network operators.

Benefits of the register include advance notice of planned power cuts, priority support during emergencies and help with meter readings or alternative bill formats.You will need to reach out to your suppliers directly to get this help. 

• Find out more: help if you're struggling to pay your energy bills

3. Statutory sick pay

If you work for an employer and you're too ill to work, you may be able to claim Statutory Sick Pay (SSP), which is the legal minimum amount employers must pay. 

The current standard weekly rate of SSP is £118.75 and is paid for a maximum of 28 weeks on your normal monthly or weekly payday. 

Historically, SSP started only from the fourth day of illness, and employees had to earn above a Lower Earnings Limit to qualify. However, new reforms under the Employment Rights Bill are set to remove the earnings threshold and make SSP payable from the first day of absence.

• Find out more:  how much is statutory sick pay?

4. Accessing your pension early

If you are terminally ill you may be able to cash in your workplace or private pension early. This is called ‘Ill-health’ retirement. 

The specific eligibility criteria and the process for accessing pension funds due to ill health can vary depending on your pension policy and provider.

If your life expectancy is less than 12 months and you are under age 75, special tax rules may allow you to withdraw 100% of your pension pot as a tax-free lump sum - provided your total savings are under the lifetime allowance, which currently sits at £1,073,100.

You should always confirm the terms with your pension provider, as they may also offer survivor pensions to partners.

Your state pension cannot be accessed early due to illness, and you can only claim it once you reach the state pension age.

• Find out more: can I take a lump sum from my pension?