Simplifying Council Tax Reduction for Parents with Newborns in Neonatal Care

In 2025, the Scottish Government introduced new regulations to help parents with newborns requiring neonatal care by amending the Council Tax Reduction (CTR) scheme. Here’s a quick breakdown of what this means for families in Scotland.

New Support for Parents

Starting 25 June 2025, the Council Tax Reduction (Miscellaneous Amendment) (Scotland) (No. 3) Regulations 2025 will ensure that parents of newborns needing neonatal care are treated equitably when calculating their Council Tax Reduction. This aligns with how other types of parental leave, like Maternity and Paternity Leave, are currently handled.

What Are Statutory Neonatal Care Pay and Leave?

These are new paid leave entitlements for parents whose newborns are either born sick or prematurely and need hospital care within 28 days of birth. If the care lasts for at least seven days, parents can take up to 12 weeks of leave.

To qualify for this support, parents must:

• Be employed at the time their baby starts neonatal care.
• Have worked for their current employer for at least 26 weeks.
• Note that self-employed individuals are not eligible.

Impact on Council Tax Reduction

The primary goal of the amendments is to ensure that receiving Statutory Neonatal Care Pay and Leave does not disadvantage parents in the context of the CTR scheme. These amendments mean:

• Parents on neonatal care leave are considered to be in work for childcare cost considerations in the CTR calculation, but not for other purposes.
• This change maintains the current level of council tax liability without increasing or decreasing it.

Compatibility and Impact

The regulations are aligned with the United Nations Convention on the Rights of the Child, ensuring that children’s rights are respected.

While no formal consultation was required for these changes, a Child Rights and Wellbeing Impact Assessment was conducted. Importantly, these changes do not affect the financial responsibilities of households or the government.

Final Thoughts

These amendments reflect a compassionate approach to support families during challenging times, ensuring that financial assistance via the Council Tax Reduction scheme is accessible and fair for all parents with newborns requiring neonatal care.