How To Deal With Council Tax Arrears
How To Check Your Council Tax Band Is Correct
When the Council Tax system was originally introduced in 1991 each house was given a band between A to H based on similar features across those properties. For example, the size of the property, how many bedrooms it has and/or what location it is in. This was not done very scientifically and essentially the onus has been on the home owner to challenge any band that they believed to be inaccurate, but this is not routinely done because we commonly accept Government valuations of our properties. The Valuation Office Agency who are responsible for the valuation of homes across the UK have created a website at which you can check the valuation assigned to almost any property throughout the country, including your current property. It will take you less than 2 minutes to do this and it could be the most lucrative 2 minutes you have ever spent. Simply go to the site any fill in the short online form which asks the following questions;
There are also a number of other boxes but you do not need to fill these in. Hit the search button and you will be presented with a short summary of the current council tax band under which your property is valued and the date that this was effective from. Now here is the key test, repeat this process with the properties either side of your address (providing that they are roughly similar to your own in size). If your property is valued at a higher level than your neighbours, then you should click the button that allows you to challenge the council tax valuation and follow the instructions. You will be contacted by the Valuation Office Agency and if they agree with your challenge your council tax bill will be amended accordingly. In addition you may be able to claim back for any overpayments you have made since the valuation code was made effective, often dating back to 1994. To get started you can visit the Council Tax Valuation Website.
Some people who accumulate council tax arrears do not realise that they have previously been eligible for a council tax discount or are exempt from paying it in the first instance. As you would expect there are numerous situations where this could apply but here is a brief summary.
Exemptions
Discounts
If you are on income support or incapacity benefit or on a low income you may be entitled to a discount. This requires you to complete a means enquiry form and fill in details about your income and savings. These can be obtained from your local council and if your income falls below a certain level you will be able to qualify for this. You can also claim a council tax discount of 25% if you share a house with someone who is a student. Full time carers and those who look after someone with a mental disorder who permanently reside at the address are also able to claim a discount.
Addressing Council Tax Arrears
If your property is currently correctly valued and you are not eligible for any council tax exemptions or benefits but are still in council tax arrears, then the most important thing you should do next is contact your council. Explain your situation and provide evidence of your income and ask for consideration to be given to renegotiating your council tax payments to avoid getting into any further arrears. Most councils will expect you to pay back any council tax arrears within that financial year, which runs from April to April. These arrears payments will have to be made in additition to any existing council tax monthly payments, so only offer your local council a payment that you know you can afford and be realistic.
If you fail to keep you your council arrears repayments, then your local council has the right to apply to a Court for something called a Liability Order. Essentially this will force you to pay the full amount of council tax arrears back and you will be issued with a summons - a legal request to attend Court for a Liability Order to be considered. At this Court hearing your case will be discussed and no further action taken if you agree to a repayment plan with your local council. If you are unable to reach an agreement the Court could decide to impose a Liability Order, which effectively gives them a number of powers to force you to pay your council tax arrears in full. The Court can ask for any council tax arrears to be paid by taking property from your house through the use of bailiffs, deducting money from any benefits you receive or from wages paid to you by your employer and can also force you into bankruptcy if it is proved you owe more than £750.00. None of these measures are very pleasant and it is worth attempting to resolve any issues prior to attending a Liability Hearing.
If all of this fails and you continue to owe council tax arrears then the Court has the power to send you to Prison by applying for a Committal Warrant. Once again this process can be permanently stopped or suspended if you are able to demonstrate a willingness to comply with a debt repayment plan for your council tax arrears.
Council Tax Arrears Action Plan
1. Check that your property is correctly valued - this could save you thousands and instantly address your council tax arrears.
2. Check that to see if you are eligible for any council tax exemptions or discounts.
3. If after steps 1 and 2 you still find yourself in arrears then seek some independent debt advice from a debt counsellor.
4. Contact your local council and make an arrangement to pay back the arrears. You may need to provide evidence of your income and outgoings to do this.
5. Prioritise these repayments, as further non payment may cause problems for you at a later point if faced with legal action.
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