Thank you to BobKirkpatrick for referring me to the Council Tax (Reducations for Disabilities) Regulations 1992. Local Council has told me that the criteria relating to the use of a wheelchair indoors is "insufficient" and that there must be physical alteration or a change in usage. Can they set their own criteria in this way?

No, they can't. If the dwelling satisfies the criteria laid down in the Regulations, then that's it. If the dwelling has "sufficient floor space to permit the use of a wheelchair" and the person concerned uses their wheelchair within the dwelling, then it qaulifies for a disability reduction.

Similarly, if a dwelling has a room predominantly used by a disabled person - e.g. for kidney dialysis, or for keeping braille equipment - then that would also satisfy the criteria. There is nothing in the Regulations which says that a dwelling has to have been adapted in any way. It could, for example, apply to a two-bedroom property occupied by a single person or a couple, where one bedroom is used predominantly by the disabled person.

As far as I know, the only official guidance is the series of "Council Tax Practice Notes" issued in 1993 (and not, it seems, available on the web). Practice Note 2 - "Liability, Discounts and Exemptions", says the following:

"REDUCTIONS FOR PEOPLE WITH DISABILITIES

34. The liable person may apply for a reduction in the bill under the Disabilities Regulations. A reduction is applicable if one of the following is a feature of the dwelling, and is required as essential or of major importance to the well-being of a disabled person (child or adult) resident in the dwelling because of the nature and extent of his or her disability:

a. a room other than a bathroom, kitchen or lavatory which is used predominantly by the disabled person;

b. a second bathroom or kitchen;

c. extra spae inside the property to allow for wheelchair circulation.

In deciding whether this condition applies, authorities should consider whether, if the room or extraeature were not available

i the disabled person would find it physically impossible or extremely difficult to live in the dwelling;

ii. his health would suffer or the disability would be likely to become more severe.

35. The reduction will be equivalent to a rebanding of the dwelling into the band immediately below that shown in the valuation list....

36. A reduction may be granted under a. above in respect of an extension or an existing room. Examples are rooms used for storing dialysis equipment or wheelchairs, or a bedroom provided at ground floor level in a property with two or more storeys."

So, the practice note makes it clear that there is no requirement for any structural alteration to a dwelling to enable the disability reduction to apply in terms of a room, and it also simplyrefers to "extra space inside the property to allow for wheelchair circulation".

If you quote the Regs and the Practice Note, and still have no joy, then all you can do is appeal to a Valuation Tribunal. But you need to do this within 2 months of the local authority's formal decision. See CPAG's Council Tax Handbook for more details.