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Tax scheme was irrational & discriminatory, court rules

24 September 2025
Issue: 8132 / Categories: Legal News , Human rights , Tax , Local authority , Discrimination
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A local authority council tax scheme ‘double counted’ a disability pension and carer’s allowance, the High Court has held

R (on the application of LL & AU) v Trafford Metropolitan Borough Council [2025] EWHC 2380 (Admin) concerned Trafford Council’s working age local council tax reduction scheme for the current tax year. Claimants LL and AU previously received a 100% reduction on their council tax, but in March they were each billed for the full amount.

They argued, first, the scheme was unlawfully adopted as the decision was taken by the executive committee rather than the full council. Second, its design was discriminatory since the means test ‘double counted’ certain benefits and pensions. LL’s private occupational pension and AU’s carer’s allowance reduced their actual income from universal credit but increased their deemed income under Trafford Council’s system.

Trafford Council accepted their system had flaws but attributed this to the software it used. While it had requested an amendment to the software, it was dealing with the issue by granting discretionary relief where necessary.

The claimants rejected the argument that only the software was flawed, and contended the issues were inherent in the scheme itself. Moreover, many residents were at risk of discretionary relief being denied.

Quashing the scheme and ordering the claimants be compensated, Judge Pearce said: ‘A scheme which requires the exercise of discretionary support is not sufficient to rescue it from a finding of irrationality.’

Judge Pearce noted that, to receive discretionary support, ‘a person has to make application to a potentially limited fund that makes usually short-term award payments and from which application there is no right of appeal’.

Carolin Ott, senior associate at Leigh Day, representing the claimants, said: ‘The council must go back to the drawing board and ensure that a lawful and fair scheme is put in place.’

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NEWS
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Professor Dominic Regan of City Law School and the Frenkel Topping Group—AKA The insider—crowns Mazur v Charles Russell Speechlys LLP as his case of 2025 in his latest column for NLJ. The High Court’s decision—that non-authorised employees cannot conduct litigation, even under supervision—has sent shockwaves through the profession. Regan calls it the year’s defining moment for civil practitioners and reproduces a ‘cut-out-and-keep’ summary of key rulings from Mr Justice Sheldon
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