Council tax is a tax levied on households by local authorities in England, Wales, and Scotland. Contributions are used to partially fund services like rubbish collection and policing provided by local governments within each country. The tax applies to all domestic owned and rented properties, with the amount dependent upon the valuation band for the home, how much the local council charges for this band, and whether any exemptions or discounts are available.
The ultimate consequence for non-payment of council tax is imprisonment. It is very rare this happens, and most councils instruct bailiffs or apply for an attachment of earnings from your employers or Universal credits. Contact us immediately if you have council tax debt, bailiffs or an attachment of earnings.
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Bills for council tax are paid in instalments over a ten-month period
People who cannot afford to pay council tax bills should list all their creditors and amounts due and prioritize this list to determine who should be paid first. The individual should then contact the local council to offer to make council tax payments that are affordable.
Council Tax Benefit is designed for residents with a low income and savings of approximately £16,000 or less, regardless of their employment status. A Second Adult Rebate is another form of financial relief and applies to a person who shares a home with someone age 18 or older who is not a civil partner or a partner has a low income and is not paying any rent or council tax. An individual may qualify for this benefit even if he or she does not receive Council Tax Benefit.
The local council can apply for a Liability Order with the Magistrates’ Court for residents who cannot come to an agreed payment arrangement with the local council or who make payment arrangements but do not pay. This order is a demand to pay the full amount owed plus costs. The individual can attend court to explain why he or she is not liable for this debt or may speak to the council or local Citizens Advice Bureau regarding the issue. The council will then try to come to a payment arrangement.
If a Liability Order is issued, the council can take action to recover the debt
This may include wage and benefit deductions, bailiff acquisition and sale of the property, charging orders, or even bankruptcy. If bailiffs get involved, they must send the individual a letter two weeks before their first visit to the home stating how much is owed. The individual should immediately contact the bailiffs and the council to prevent bailiff costs from being added to the amount due.
When full repayment is not made by using bailiffs, the council may apply for a warrant with the Magistrates’ Court. The court will hold a means enquiry, with the debtor present. If it determines that culpable neglect or willful refusal is the reason for failure to pay the council tax, the warrant of commitment will be issued. This carries a maximum imprisonment period of three months.
Certain conditions, such as repayment over a specified period, may cause the court to postpone the imprisonment period. The court may also remit a portion or the entire amount of the debt. Individuals who are unable to afford council tax payments should get free advice regarding their debt management options.