If you’ve fallen behind with your council tax payments you’re not alone. Hundreds of thousands of people are facing action from their council authorities due to council tax arrears.
Many have fallen foul of the Government’s cuts in benefits, with people previously exempt from paying now having to find impossible sums of money every month to pay their council for household services.
However, unlike normal unsecured debt, such as credit card balances, overdrafts or utilities arrears, council tax arrears cannot be written off by anyone other than a magistrate and only then after every avenue has been explored by the courts.
The debt must be paid, and paid in full, and it can be a harrowing experience if you don’t.
But what if you simply can’t pay the arrears that your council is demanding in the timeframe they want? What then?
Arranging A Better Payment Plan
Your first port of call is to speak to the council and see if you can arrange a payment plan that suits you, rather than it. Usually the council will want the debt to be paid before the end of the current financial year on 4th April.
If you cannot do this due to your circumstances, for example illness or unemployment, they will usually agree to let you pay it back over a longer period of time but you will have to ask and sometimes even insist.
You will be expected to make your normal council tax payments every month along with a proportion of your arrears on top.
A Liability Order
If you do not pay your arrears or sort out a payment plan to do so, your local authority will take action through the courts to obtain a liability order to force the money from you. It can do this is several different ways.
Benefit Deductions – It asks the Department of Work and Pensions to take a monthly amount directly from your benefits before you get it. You then end up having to live on whatever is left over.
Attachment Of Earnings Order – It asks you employer to take a monthly amount directly from your wages before you get it. Again, you end up having to live on whatever is left over.
Bailiffs – It will employ bailiffs to visit your home and seize your belongings to the value of your debts.
Bankruptcy – It will apply to the courts to make you bankrupt if you owe more than £750.
Charging Order – If you owe more than £1000 the council can obtain the power to force you to sell your home and make a payment on your arrears once your mortgage has been paid off.
A Committal Warrant
If the council cannot make any of the above work in your circumstances, it can go back to the magistrates’ court and apply for a committal warrant to send you to prison.
This is a very serious step, and not many cases get this far, but if it can be proved that you have the money to pay and are deliberately not paying, or are making no effort to pay and none of the measures above have worked, the council may feel prison is the only resort left.
However, even at this late stage you will still be given the opportunity to set up a payment plan to pay off your council tax arrears.
If you still maintain you cannot pay your arrears, the magistrates will look at all of your financial affairs as part of a means enquiry, and if it is proved you have no means to pay, it is within the magistrates’ power to write off some or all of the debt.
Having council tax arrears that you cannot pay can be a very stressful experience, especially if the council gets the courts involved.