New care legislation had created the anomaly

The problem, which was caused by new care laws, affects some people who receive a housing support service and live in shared accommodation.

However, the Scottish Executive will amend the anomaly with new legislation which will be introduced on 1 October.

The executive has also told councils to write off any debt of people affected and refund those who have already paid.

'Unfortunate anomaly'

Finance Minister Tom McCabe said: "I am pleased we have been able to address this unfortunate anomaly.

"We fully appreciate this situation will have been upsetting for those affected and that is exactly why we have taken this action to sort it out.

"We will ensure the loophole is closed and that no-one is one penny out of pocket as a result of it."

Mr McCabe said it had taken longer than the executive would have liked to resolve the issue because of its complexity.

The loophole came about because some homes which were previously classed as care homes are now registered as providing a housing support service to individuals with separate tenancy agreements.

'Relentless inequality'

These are akin to standard sheltered homes but they provide a higher level of support.

The homes affected are those where certain parts are shared by the residents, such as the kitchen, and where a housing support service is provided.

The SNP welcomed the move but said the loophole was "just another example of the relentless inequality of the council tax system".