All perfect praise be to Allaah, The Lord of the Worlds. I testify that there is none worthy of worship except Allaah, and that Muhammad is His slave and Messenger.
A Muslim who resides in a non-Muslim country is obliged to abide by the conditions set by the people of this country (in order to permit him residence) provided these conditions do not contradict the Sharee'ah, and he should not betray them.
Therefore, he is not allowed to encroach on their properties or take something without right or lie to them. Lying is forbidden and it is one of the grave major sins. This ruling does not change from one time to another or from one place to another.
Therefore, you are not allowed to try to get the council house if it entails lying, as this is forbidden. In fact, this is safer for your religion and honor. Think about the embarrassment and humiliation you will face if the authorities find out about your lies. What would be the situation if it is spread that Muslims lie to gain some worldly benefits? So, we advise you to be patient and to set a good example for your religion, particularly in that society. You should know that whoever gives up something for the Sake of Allaah, Allaah will recompense him with something better.
Allaah Says (what means): {…And whoever fears Allaah—He will make for him a way out. And will provide for him from where he does not expect…}[Quran 65:2-3]
The fact that your husband pays taxes does not permit you to receive the house through lies. You have to pay what is due upon you and you should ask Allaah to get your rights. The Prophet said about non-Muslims: "We will fulfill their agreements and seek the help of Allaah against them." [Muslim]
Allaah Knows best.