Council Tax Debt

Having to pay your Council Tax comes with a lot of questions and concerns. Your personal situation might change during the course of the year, or your Council Tax payment may have increased without much prior warning. This can make it a bit of a struggle to get the payment together. If you make your payments via instalments, it can be quite easy to end up in arrears.

At NDH Financial, our debt consultants are on hand to help our customers resolve any issues they may have in dealing with their Council Tax arrears. 

May not be suitable in all circumstances.
Fees apply. Your credit rating may be affected.

What is Council Tax?

Council Tax is the annual payment you make to your council in return for them providing services to the local community. This includes roadworks, library upkeep, police and fire services, and rubbish collections. The tax is based on the value of your property. 

The amount of Council Tax you pay will vary from local authority to local authority. They will also take into account the following: 

  • Your personal finances 
  • The cost of your home
  • The amount required by the council in order to keep the services running. 

If you live in the UK, you can find out the amount of Council Tax you should be paying here.

What happens if you can't pay your Council Tax? 

The first thing to do if you cannot pay the annual Council Tax amount is to speak to the local Council Tax office, who will be able to work with you to create an agreement where you are able to pay your Council Tax in instalments. This will usually be a monthly payment. 

What happens if you miss your Council Tax payments?

If you miss a payment the council will wait two weeks before sending you a reminder. When you receive the letter, they will give you seven days to make the payment without any consequence. 

If you fail to make your payment within seven days or have missed three payments in a row, you will be served with what is known as a final notice by the council. This means the agreement no longer holds and you will have to pay your Council Tax in full within the next seven days. 

Following any failure to make a payment after receiving your final notice, the council will go to court and request a liability order. 

Should you fail to make the payments even after the liability order, you will risk facing a prison sentence, but only in extreme cases. This only occurs in incidents where there is evidence you are deliberately refusing to pay your Council Tax.

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What is a Council Tax liability order? 

If you fail to make your Council Tax payments and you avoid any of the letters sent to you by the council, the council may apply for a liability order. A liability order is approved by the magistrates’ court to enable the council to retrieve its outstanding Council Tax.

The liability order will be put to the person to whom the council originally wrote regarding the missed payments. If you are making joint payments towards the Council Tax with a partner or roommate, the council can request for the liability order to be placed on all persons concerned. 

When you receive a liability order, you will be able to present your case in front of the magistrates’ court, detailing the reason behind the missed payments. You may also be charged court fees. 

What happens next?

If no payments are made following the issue of a liability order, the council has the power to use the following actions to retrieve its missing payments: 

  • Send bailiffs to your property to retrieve payment 
  • Receive money directly from your wages or support allowance 
  • Gain payment from benefit programmes such as jobseekers allowance and pension credit 

In order to do this, they will need to request certain information from you. This may include your employer's details, your earnings, and the amount expected to be deducted from your wages. If you are receiving additional money from benefits and someone else is responsible for paying the Council Tax, they will also request this information from you. 

Once they request this information from you, you have 14 days in which to provide it to the council. Failing to do so or providing false documents is a criminal offence. If you do not have the information they are requesting, speak to your local council as soon as possible.

Can Council Tax arrears be written off?

There are some debt solutions which enable you to write off your Council Tax debt. If you apply for bankruptcy or a debt relief order (DRO) you can write off your Council Tax payments. However, these measures should only be taken if you meet the required criteria and you have carefully considered their suitability. 

If you have other debts and have submitted an Individual Voluntary Arrangement, you will be able to include the Council Tax in it. Once approved, the Council will be prevented from taking any further action against you.

Can bailiffs force entry for Council Tax debt? 

Your local council can send bailiffs (also known as enforcement agents) to your door if they have been unsuccessful in retrieving their debts. Before the bailiffs arrive you should be able to confirm the amount you owe them. It is worth noting that bailiffs are not allowed to force themselves into your property unless you have a controlled goods agreement in place

What is a controlled goods agreement?

A controlled goods agreement is an agreement between the bailiff and the debtor in which the debtor is able to remain using their possessions and, in return, they pay off the remaining Council Tax debt with an agreed payment schedule.

Before signing the controlled goods agreement make sure all the details are correct, including the amount you owe and any additional fees required. 

If a bailiff is going to visit you at home, they will have to do so between 6 am and 9 pm. If they come to your door outside of this, they will require a court warrant.  You can find out more about bailiffs and your rights here.

What if the bailiffs have already been inside my home? 

If you have already let the Council Tax bailiffs inside your home, it is important to bear in mind that the bailiff will not take any of your possessions straight away. 

What possessions can bailiffs not take? 

Council Tax bailiffs are not allowed to take the following possessions from you as part of your payment:

  • Clothing
  • Furniture and basic household items you need to carry out basic domestic duties (including ovens, microwaves and refrigerators) 
  • Bedding 
  • Items needed in order for you to do your job such as tools, books, and electrical items like laptops and vehicles. The value of these items has to amount to £1,350 or less.

What additional fees can the council charge for Council Tax debt? 

If a bailiff is called, there is a chance you will have to pay bailiff fees in addition to court fees and repaying your Council Tax debt. 

What are the extra fees they can charge? 

  • £75 - This will go towards paying the creditor who carries out the initial checks and investigation.
  • £235 - This is for the bailiff coming to your property and taking your goods. 
  • £110 - This goes towards the bailiffs taking your goods from the property, evaluating them and issuing them for sale. 
  • There may also be costs for storing the goods and hiring a locksmith if required. 
  • You should be provided information about the amount you owe by the bailiffs ahead of their visit and once they have completed their visit. 

    If you are worried about bailiffs and would like to speak to an expert, apply for a free consultation here.

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    Get in touch with NDH Financial today for a free consultation about your debts.

    Call us on 0800 002 9051 or apply below.


    Can you go to jail for not paying Council Tax? 

    If you live in England, in short, yes. There is a chance you could do some jail time if you fail to pay your Council Tax, however, this happens rarely. If the council has made numerous attempts to retrieve the money including a liability order and has yet to receive the payment, and the bailiffs are unable to recover enough items to make the payment, a Magistrate could sentence you to up to three months in prison. 

    Before making its decision, the court will take two things into consideration: 

    • Are you able to afford the payments? 
    • Did you have a valid reason for missing the payments? 

    When considering your case, the Magistrate should take into account your circumstances and ability to pay. You may be able to avoid prison if the court allows you to make payments within a certain allocated time, or if you can demonstrate you were not in a position to make the payment. It is also worth noting that the court has the power to remove the debt.

    Does Council Tax affect your credit score?

    Fortunately, unlike other forms of debt such as credit card debt, your Council Tax arrears do not appear on your credit file and therefore do not impact your credit score. 

    Even if the Council apply to Court, as they do not require a County Court judgement, it is unlikely the Court action would be recorded on your credit file. This means if you are applying for a mortgage or loan, it should have no bearing on the outcome of your application, although you should carefully consider taking out any further credit if you are struggling to pay your Council Tax.

    Can I ask for a discount on my Council Tax? 

    If you are unable to afford the Council Tax payments, notify your council as soon as possible.

    They may be able to offer you a tax reduction if you meet the below criteria:

    • You are on a low income 
    • You are a student 
    • You're living on your own 
    • You are on benefits - such as universal credit, job seekers allowance and income support
    • You are in prison for a crime unrelated to Council Tax payments 
    • You're the only adult living on your property
    • You are required to live in a larger home due to you or a cohabitant dealing with a disability. 
    • You are mentally impaired 
    • You live with someone who is mentally impaired 
    • Certain counties in England and Wales will take into account if you are a caregiver for someone in your household.

    In order to apply for this reduction, you will need to make sure you have the valuation of your home and the amount of Council Tax you would pay on a property with that valuation. If you have had any changes to your circumstances since you last paid your Council Tax, a valuation officer will be able to confirm if the changes will impact the Council Tax you are eligible to pay.

    What if my council won't help me?

    If you feel the council has not helped you or failed to follow the correct procedures you can put forward a complaint but please note, this can be a lengthy process. 

    The first complaint must go to your council, which can take up to 12 weeks before you hear a reply. If you are unhappy with the outcome you can make a second complaint to the ombudsman; this needs to be done within 12 months of you realising the council has not helped you correctly or followed procedure.

    Tips for dealing with Council Tax arrears

    There are a few things you can do right off the bat to help you pay back your Council Tax arrears: 

    Speak to your local council

    Each council works differently so by getting in touch with your local authority you will be able to see exactly what help is on hand, from repayment plans to tax reductions.


    Reassess your benefits

    If you have had a sudden change in income it is worth checking what benefit support is out there for you. The benefits you are entitled to may also impact your Council Tax as it could help you get a cheaper rate. This is something our debt consultants can discuss with you.

    Begin clearing your Council Tax debt today! 

    Our team at NDH Financial understands how stressful it can be to deal with Council Tax. You are not alone. It is OK to ask for help. As a fully licensed insolvency practitioner, our job is to help you find the solution to clear your debts.

    We assist thousands of people in becoming debt-free. Join them and begin your debt-free journey with a free consultation today.

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