IVA Advice Guide – Council Tax Arrears

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Advice for Managing Council Tax Arrears

IVA.TV have reproduced the Crown Copyright Guide on Council Tax Arrears. Not paying Council Tax Arrears can result in one of the most severe sanctions of any debt – prison! We can also offer advise on how to manage your other bills in order to help make your Council Tax Payments more affordable. Your Council Tax Bill is a Priority Debt that needs to be paid before other less important bills.

Guide on Council Tax Arrears

What to do if you can’t pay your Council Tax and what happens if you don’t pay

You usually pay your Council Tax bill in instalments over 10 months. If you’re having difficulty making a payment, contact your local council immediately and explain the situation – the longer you ignore a debt problem, the worse the situation becomes.

What to do if you can’t make a Council Tax payment

If you can’t make a Council Tax payment, make a list of everyone you owe money to (your creditors) and prioritise your debts so that you know which debts you need to pay off first. Next draw up a personal budget so you can work out what you can afford to pay each creditor.

IVA.TV can help you reduce your current credit commitments to a more affordable level.

What if you still don’t pay?

If you are unable to come to a payment arrangement with the council or if you make arrangements to pay but don't, your council can ask the Magistrates' Court for a 'Liability Order' (a demand for you to pay the full amount you owe, plus costs).

You have the right to attend the court and offer evidence as to why you are not liable for the debt. Even if you decide not to attend court, you should speak to the council or, if you prefer, your Local Citizens Advice Bureau. The council will try to come to a reasonable arrangement with you for payment but they cannot do that unless you contact them.

The consequences of ignoring a Liability Order

If the court makes a Liability Order against you, your council can take enforcement action against you in order to recover the debt. This will usually mean either deductions from wages and benefits or the use of bailiffs, although bankruptcy and charging orders are other options.

Deductions from wages

Your council can order your employer to deduct a regular amount from your wages toward your unpaid Council Tax. If this causes you financial hardship, you can ask your council if they’re willing to accept smaller payments.

Deduction from benefits

Your council may be able to apply for deductions if you are receiving Jobseekers' Allowance, Income Support or Pension Credit.

Bailiffs

Your council can send bailiffs to your home to seize property to sell. The money raised goes towards paying your debt, plus costs. The billing authority must send a letter two weeks before the bailiff's first visit stating how much money you owe under the Liability Order.

You can contact the Council and the bailiffs and offer to come to an agreement on payments. It's important to do this straight away, because if the bailiffs make a visit their costs could be added to your bill.

Court hearing

If your council has tried using bailiffs but your Council Tax still isn't paid in full, they may apply to the Magistrate's Court for a warrant committing you to prison. The council will only take this step when other efforts have failed.

Before issuing a warrant of commitment the court must hold a means enquiry with you present. A warrant will only be issued if the court is satisfied that the failure to pay is the result of wilful refusal or culpable neglect. The maximum period of imprisonment is three months.

The court may decide to postpone the period of imprisonment on certain conditions, normally relating to payment of the debt over a period of time. The court also has the power to remit all or part of the debt.

For further advice please contact IVA.tv.

Information in the above IVA Advice Guides and Debt Advice Guides includes extracts from Crown Copyright Advice Guides Direct Gov UK