Formed in 1974 following Local Government Re-organisation, Willoughby and District Parish Council covers the areas of Willoughby, Sloothby and Claxby St Andrews. As a local authority the Parish Council is bound by Local Government legislation, which governs the things it can and cannot do. Parish Councils are in the main financed through the raising of the precept, a compulsory tax on all properties within the parish. Whilst the Parish Council sets its own precept, the District Council oversees its collection and forwards it on the the Parish Council. In setting the Precept the Parish Council must take into account its potential expenditure for the year, including salaries, insurances, grounds maintenance etc. Setting the precept is done through consideration of budget headings. Some Parish Councils also raise funds through the management of parish cemeteries, but the majority of funds for a parish council come from the precept and any grant monies applied for.
Parish Councillors are elected every four years, between elections any vacancies can be filled by co-option. At the present time (July 2022) the Willoughby Parish Council has one vacancy. Vacancies are known as "seats", and the Parish Council has 9 seats.