The offer is available up to £750, applies to all products in the Homebuyer and FTB Choices ranges and is valid up until 7 May 2010.
The average Council Tax bill in Great Britain has increased by 121% over the past 13 years, from £529 in 1996-97 to £1,166 for the current financial year.
Stephen Noakes, commercial director of mortgages at Lloyds Banking Group, said: “We all know that moving into a new home can be both a stressful and expensive time. By paying half of the Council Tax bill, we’re supporting customers with one of their biggest monthly outgoings, at a time they need it most.”