They may not realise they’re eligible for a discount (Picture: Getty Images)

Thousands of people who are ‘severely mentally impaired’ are being overcharged by their councils, it has been claimed.

People with conditions such as dementia are eligible for council tax discounts, and it’s believed that many are owed rebates worth thousands of pounds.

Research by Money Saving Expert has shown that up to 100,000 people who are entitled to council tax discounts are not claiming them.

This, MSE claims, is mainly down to councils giving out misinformation to residents.

If a person with Alzheimer’s, Parkinson’s, dementia or similar disorders only lives with one other person, usually their carer, then the household is entitled to a 25% discount. If the person with the disorder lives alone, they can get a 100% discount – meaning they don’t pay council tax at all.

Philip, who was affected, told the site: ‘My wife started receiving benefits for Parkinson’s in 2001. My council originally told me that we didn’t qualify as we had savings. However, it eventually admitted it had given us wrong information and we were given a 25% discount.’

Many of the country’s most vulnerable are being overcharged (Picture: Getty Images)

MSE compiled the report by submitting Freedom of Information requests to 265 councils, and by conducting a mystery shopper-style exercise of 100 councils.

‘Two-thirds of councils provided incorrect information,’ the report said. ‘During the mystery shopper exercise, council tax staff were unable to clearly explain to the MSE “applicant” the criteria for eligibility or how to submit a claim for the discount. Five call handlers were unaware of the SMI discount, with some confusing it for a means-tested benefit.’

Only a quarter of councils they went to gave them information that was completely correct.

Martin Lewis, founder of MSE, said: ‘The law rightfully recognises that many vulnerable people who have a severe mental impairment such as dementia or Alzheimer’s are entitled to a council tax reduction. Sadly many councils do not and the result is that society’s most vulnerable face a postcode lottery with huge variance in take up depending on where people live.

Thousands could be getting overcharged (Picture: Getty Images)

‘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.’

‘The people who are missing out on this are amongst the most vulnerable in our society and can’t fight for themselves. They should not be left to battle this alone.’

Charities are also calling on councils to better educate their staff.

Nicola O’Brien, Head of Policy and Campaigns at Alzheimer’s Society, said: ‘Many people with dementia and their families are already under devastating financial strain as a result of their condition, with some forced to spend hundreds of thousands to get the essential care they need from the broken social care system.

‘Lack of awareness and information about council tax discounts, and other financial support out there, only make the situation harder.

‘It’s crucial that discounts are clearly signposted to, and simple to apply for, to make sure people get the support they are entitled to.’