Section 42A: Calculation of council tax requirement by authorities in England, Local Government Finance Act 1992

In relation to each financial year a major precepting authority in England must make the calculations required by this section.

The authority must calculate the aggregate of—

the expenditure the authority estimates it will incur in the year in performing its functions and will charge to a revenue account for the year in accordance with proper practices,

such allowance as the authority estimates will be appropriate for contingencies in relation to amounts to be charged or credited to a revenue account for the year in accordance with proper practices,

the financial reserves which the authority estimates it will be appropriate to raise in the year for meeting its estimated future expenditure, and

such financial reserves as are sufficient to meet so much of the amount estimated by the authority to be a revenue account deficit for any earlier financial year as has not already been provided for.

The authority must calculate the aggregate of—

the income which it estimates will accrue to it in the year and which it will credit to a revenue account for the year in accordance with proper practices, other than income which it estimates will accrue to it in respect of any precept issued by it, and

the amount of the financial reserves which the authority estimates that it will use in order to provide for the items mentioned in paragraphs (a) and (b) of subsection (2) above.

If the aggregate calculated under subsection (2) above exceeds that calculated under subsection (3) above, the authority must calculate the amount equal to the difference; and the amount so calculated is to be its council tax requirement for the year.

In making the calculation under subsection (2) above the authority must ignore payments which must be met from a trust fund.

In estimating under subsection (2)(a) above an authority must take into account—

the amount of any expenditure which it estimates it will incur in the year in making any repayments of grants or other sums paid to it by the Secretary of State, and

in the case of an authority which is a county council, the amount of any levy issued to it for the year.

But (except as provided by regulations under section 74 of the 1988 Act) the authority must not anticipate a levy not issued.

In estimating under subsection (2)(a) above an authoritymust take into account the amount of expenditure which it estimates it will incur in the year in accordance with regulations under section 99(3) of the 1988 Act.

For the purposes of subsection (2)(c) above an authority's estimated future expenditure is—

that which the authority estimates it will incur in the financial year following the year in question, will charge to a revenue account for the year in accordance with proper practices and will have to defray in the year before the following sums are sufficiently available—

sums which will be payable to it for the year, and

sums in respect of which amounts will be credited to a revenue account for the year in accordance with proper practices, and

that which the authority estimates it will incur in the financial year referred to in paragraph (a) above or any subsequent financial year in performing its functions and which will be charged to a revenue account for that or any other year in accordance with proper practices.

In making the calculation under subsection (3) above the authority must ignore payments which must be made into a trust fund.

In estimating under subsection (3)(a) above the authority must take into account the sums which the authority estimates will be paid to it in the year by billing authorities in accordance with regulations under section 99(3) of the 1988 Act.

The Secretary of State may by regulations do one or both of the following—

alter the constituents of any calculation to be made under subsection (2) or (3) above (whether by adding, deleting or amending items);

alter the rules governing the making of any calculation under subsection (2) or (3) above (whether by deleting or amending subsections (5) to (10) above, or any of them, or by adding other provisions, or by a combination of those methods).

This section is subject to section 52ZT below (which requires a direction to a major precepting authority that the referendum provisions in Chapter 4ZA are not to apply to the authority for a financial year to state the amount of the authority's council tax requirement for the year).

Section 42A: Calculation of council tax requirement by authorities in England

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