Somewhere in a couple’s council tax bill is a discount worth a quarter of it, and it goes unclaimed because it is filed under a phrase nobody applies to their own family. Severe mental impairment is the law’s term. Dementia, a stroke that has taken someone’s understanding, or Parkinson’s disease in its later stages are what it describes, and the test is the effect on the person, not the name of the condition.
What the law says
The Local Government Finance Act 1992 says a person is severely mentally impaired if he has a severe impairment of intelligence and social functioning, however caused, which appears to be permanent (Local Government Finance Act 1992, Schedule 1, paragraph 2, checked 1 November 2026).
A person who meets that definition is disregarded for council tax, which means they are not counted when the council decides how many adults live in the home.
The Act does not name any condition. It says however caused, and it asks about permanence. A doctor’s certificate settles whether the definition is met; the council’s job is to apply the discount once it has the certificate and the benefit evidence.
The two conditions
The Act sets out two things that must both be true. The person is stated in a certificate of a registered medical practitioner to be, or to be likely to be, severely mentally impaired, and they fulfil such conditions as may be prescribed (Schedule 1, paragraph 2, checked 1 November 2026). The prescribed condition is entitlement to a qualifying benefit.
The Council Tax (Discount Disregards) Order 1992 lists those benefits. They are incapacity benefit, Attendance Allowance, severe disablement allowance, the care component of DLA at the highest or middle rate, and the daily living component of PIP at either rate. The list continues with income support with a disability premium, Universal Credit with limited capability for work, constant attendance allowance and Armed Forces Independence Payment (Council Tax (Discount Disregards) Order 1992, article 3, checked 1 November 2026). Entitlement is what counts, not the amount paid.
The pension-age route
Attendance Allowance is the qualifying benefit for people over State Pension age, and our Attendance Allowance hub covers the claim. A person with dementia who needs prompting, supervision or help through the day is the claim the form was written for, and the award then unlocks this discount as well as the payment.
The Order has a further route for people who get no benefit. The condition is also met where the person has reached pensionable age and, had they not reached it, would have been entitled to one of the listed benefits (article 3, checked 1 November 2026). It exists for people who would have qualified for incapacity-type benefits that stop at pension age. A council can be asked to apply it, but claiming Attendance Allowance is the surer path.
What it is worth
GOV.UK sets out the effect. You get a 100% discount if you qualify and live on your own, or if any other adults in the household also qualify or are full-time students. You get 25% if you live with someone who qualifies and there are no other adults, or everyone else is disregarded.
There is a 50% discount if everyone else in the household is disregarded (GOV.UK, How Council Tax works: discounts for disabled people, checked 1 November 2026).
Take a couple. A husband whose wife has dementia and an Attendance Allowance award is, for council tax, living alone, and the bill drops by a quarter. A person with dementia living alone owes nothing: the Exempt Dwellings Order makes a dwelling occupied only by severely mentally impaired persons exempt altogether, as Class U (Council Tax (Exempt Dwellings) Order 1992, article 3, checked 1 November 2026).
How to claim it
Through the council, on its own form; GOV.UK has no dedicated page for this discount. GOV.UK says you will need to get a certificate to say you are severely mentally impaired from a medical professional such as your GP, and prove your eligibility for certain benefits (GOV.UK, How Council Tax works: discounts for disabled people, checked 1 November 2026).
Ask the council for its form; the certificate section goes to the surgery first, and the form then goes to the council with the benefit award letter.
An attorney or an appointee can do this for the person. Nothing about it is means-tested: savings, income and the value of the home are irrelevant, which separates it from Council Tax Reduction on our council tax hub. A household can have both.
Backdating
The Act disregards a person on any day the two conditions were met, and a certificate can state when the impairment began. The discount runs from the date both conditions were satisfied, because the Act works day by day, and that can be years earlier where the diagnosis and the benefit award are old.
No statutory time limit on backdating was found in the Act, the Order or on GOV.UK.
Ask for the discount from the date on the certificate or the start of the qualifying benefit, whichever is later, and ask in writing. A refund of several years’ quarter-bills can follow a claim made late, and it is the reason to check the position for any parent with a dementia diagnosis and an Attendance Allowance award.
Scotland and Wales
The same disregard exists in Scotland and Wales through their own regulations. Wales calls this one significant cognitive impairment, and the Welsh Government publishes an application form under that name (gov.wales, Council Tax discounts, disregards, exemptions and reductions, checked 1 November 2026). Scotland’s discounts are on mygov.scot and claimed from the council in the same way.