Council Tax debt help and advice

As the cost of living crisis continues to bite in 2022, we’ve seen an influx of people seeking advice on falling behind with council tax payments. This is despite the £150 rebate announced for those in bands A to D by the Government.

Recent analysis from the TaxPayers’ Alliance found that 171 authorities in England saw tax bills hit over £2,000. This represents a 64 percent increase from last year, with 55 percent of local authorities now charging more than £2,000 for a band D bill

Council tax is a payment made to your local council which helps to pay for local services, such as road maintenance and lighting, rubbish collection, schools and other similar services provided. Council tax is based on a valuation band for your property, determined by the Valuation Office Agency.

What happens if you owe council tax?

Owing council tax means that you are in arrears. If this is the situation you are in, then you should get in contact with your local council and let them know why this has happened. When you have missed a payment, the council will send you a reminder and, usually, they would expect you to make a payment within 7 days. You will be given the option to spread the cost of your council tax over 12 months instead of 10 months if that will help.

You will only receive a maximum of two reminders, after which the council will contact you and expect the whole year’s council tax to be paid in one go if you miss another payment. If you continue to owe council tax, your local council may request a liability order from the local magistrate. This is a legal demand for payment of an outstanding debt. It may result in the council’s legal costs being added to your debt.

What happens if I can’t afford to pay my council tax?

If you cannot afford to pay it, then you should contact your local council and discuss ways in which you can make payments that you can afford. You can request to make smaller, more affordable payments. If you are in a low-income bracket, then you could speak to your council about getting a deduction.

Remember not to panic! There are options available to you. The most important thing is to make contact with your local council so that they are aware that you are looking for a solution to the problem. They will then look at how they can help you.

Can I stop paying council tax?

Most people who are over 18 years of age are required to pay council tax. However, there are some exceptions. If you live on your own or no one else in the house is considered an adult, then you might be entitled to a 25% discount. If there is no one living in your home who is considered an adult, then you might be entitled to 50% off.

If everyone who lives in the house is a full-time student, then your council tax does not have to be paid. People over 18 but working on an apprenticeship scheme, under certain conditions, are also not required to pay council tax. Remember to contact your council or research for advice to see if you are eligible for any form of discount.

How long can I be chased for old council tax debt?

Typically, council tax can be collected as far back as six years, as six years is the standard limitation period for most types of debt. After that amount of time, most statutory debt, including council tax, becomes statute-barred and you can request that the local council cancels that debt. This will only work if you have not had contact with the council in those six years. However, this does not mean that the local council has to cancel the debt; the council may seek to file for a County Court Judgement (CCJ) against you. The statute law may be used to prevent the CCJ being filed but they still might be able to take other action against you. However, this does not apply in Scotland, where councils can pursue debt for up to 20 years.

Can I write off council tax?

Any council tax that is owed after six years can be requested to be written off by the local council. However, this may depend on the local council and their policy on how to vote regarding such issues in creditors meetings so this is no guarantee that you would not have to repay council tax arrears. It is within their right to chase debt for up to six years after their previous contact with you but even after the six years, it does not prevent them from filing a County Court Judgement against you. If that happens, then the debt will not be automatically written off.

A large portion of debt can be removed through an Individual Voluntary Agreement. With an IVA, you agree to repay an agreed-upon percentage of your total debts over a period of five years. After that five years, the remainder of your debt is completely written off.

Can the council take money from my salary?

The council have been given the power to contact your employer directly in order to recoup debt. The council can go to court to get an attachment of earnings order which means that the money you owe will be deducted from your earnings at an amount decided by the court. You can apply to have this suspended if it means you will not be able to pay bills or that you will lose your job. You can also apply to change the amount of money being deducted. If you change jobs, the same value will be deducted from your new earnings. They can also take it from a number of benefits payments that you may receive, such as income support, jobseeker’s allowance, pension credit and universal credit.

Can I ignore a court summons?

Do not ignore a court summons. You should get in contact with your local council as soon as possible and start to make arrangements to repay your outstanding council tax. All councils will want to work with you to find a more suitable arrangement before having to choose this option but ignoring a court summons will not do you any favours.

If you do end up being taken to court, then it is likely that the council will be seeking to get the money owed all at once and you will likely end having to pay court costs, which will only add to your debt.

Can council tax debt affect my credit score?

No, any information that relates to non-payment of council tax will not appear on your credit report. Any legal issues regarding non-payment of council tax are considered a criminal matter and therefore not a civil matter. Any fines that are imposed by courts, while affecting your level of wealth, will not appear on your credit report.

What happens if bailiffs come to collect council tax?

Remember that you have certain rights when bailiffs come to your home. They are only allowed to visit between 6 am and 9 pm. You should be sent a letter in advance to let you know that they are coming and if they are collecting for council tax owed then they should have given you 30 days advance notice before they visit you. They are not permitted to take any items from your home. When it comes to council tax collection, they should be either collecting the money, talking to you or handing over documents pertaining to the owed council tax.

What if I can’t afford to pay the bailiffs all that I owe?

If there are bailiffs at your door and you are unable to pay what you owe, then there are options. If possible, pay as much of your debt as possible then and there, this will show that you are wanting to pay. You can also request to make payments in smaller amounts and set up a timetable to make those smaller payments more regularly.

If the bailiffs come to your home and cannot afford the payments, you will usually have to make a controlled goods agreement. This is a repayment plan that includes bailiff’s fees.

Bailiffs are required to give you additional time to manage your debt if you are disabled, have children or are pregnant, under 18 or over 65, do not understand English well or are in a stressful situation, like unemployed or dealing with a bereavement.

Can I go to jail for not paying my council tax?

Technically, yes, you could go to prison if you are deliberately avoiding paying your council tax, but this usually only happens in extreme circumstances and as a last resort.

If you are experiencing problems like those mentioned above, consider seeking advice. Debtbuffer is a site that will enable to you look at different options. Debtbuffer will help you write letters to help buy more time to manage your debt, give you peace of mind from the stress of dealing with creditors and seeks to help people be treated more fairly. The site has an AI chatbot that has been designed to help people understand their debt options. The Ai chatbot will ask a number of questions to help figure out if you are suitable for a number of debt solutions, giving you a clear understanding if there is a way to write off your debts and how to manage your financial issues.