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Council tax arrears advice - Council Tax Advisors

Council Tax Arrears: What Happens When You Fall Behind

Written by Jess Gambo on . Posted in General News.

Falling behind on council tax payments can be stressful, but understanding what happens when you’re in council tax arrears helps you take the right action. This comprehensive guide explains the process councils follow and what you can do to resolve the situation.

Understanding Council Tax Arrears

Council tax arrears occur when you fall behind on your monthly council tax payments. In England and Wales, council tax is typically paid over 10 months (April to January), though some councils offer 12-month payment plans.

When Do Council Tax Arrears Begin?

  • Missing one monthly payment puts your account in arrears
  • Most councils send a reminder notice after 7-14 days
  • The full year’s bill becomes due if you miss payments after receiving reminders
  • Interest and court costs may be added to your debt

The Council Tax Debt Collection Process

Councils follow a strict legal process when collecting unpaid council tax. Understanding this timeline helps you know what to expect and when to take action.

Stage 1: Reminder Notice (7-14 days)

After missing a payment, your council will send a reminder notice giving you 7 days to pay the overdue amount. If you pay promptly, you can continue with your normal payment schedule.

Stage 2: Final Notice (if payment missed again)

Missing another payment after receiving a reminder results in a final notice. At this point, the full year’s council tax becomes immediately payable.

Stage 3: Liability Order Application

If you don’t pay after the final notice, your council will apply to the magistrates’ court for a liability order. This legal document allows them to use enforcement methods to recover the debt.

What Happens After a Liability Order

Once a magistrates’ court grants a liability order, councils have several enforcement options available:

Attachment of Earnings

  • Deductions taken directly from your salary
  • Rates vary based on your income level
  • Employer notified and required to comply
  • Continues until debt is fully paid

Attachment of Benefits

  • Deductions from certain benefits (Universal Credit, Income Support, etc.)
  • Maximum of £4.05 per week for most benefits
  • Higher rates apply for Income Support and income-based Jobseeker’s Allowance

Enforcement Agents (Bailiffs)

Councils may instruct bailiffs to collect council tax arrears. Bailiffs have specific powers and limitations:

  • Can visit your property to seize goods
  • Cannot force entry on first visit (peaceful entry only)
  • Must give proper notice before visiting
  • Cannot take essential household items or tools of trade up to £1,350

Charging Orders and Bankruptcy

For larger debts, councils may consider more serious enforcement action:

Charging Orders

  • Legal charge placed against your property
  • Debt secured against your home
  • Payable when property is sold
  • Affects your ability to remortgage

Bankruptcy Proceedings

  • Rare but possible for debts over £5,000
  • Serious implications for credit and assets
  • Usually a last resort for councils
  • Consider seeking professional debt advice immediately

What to Do If You’re Behind on Council Tax

Taking action early when facing council tax difficulties can prevent serious consequences:

Contact Your Council Immediately

Don’t ignore council tax problems. Most councils prefer to work with residents rather than pursue expensive enforcement action.

Negotiate a Payment Arrangement

  • Propose realistic monthly payments you can maintain
  • Include current year liability plus arrears
  • Get any agreement in writing
  • Stick to agreed payments to avoid further action

Apply for Council Tax Support

You might be eligible for council tax reduction if:

  • You’re on a low income
  • You receive certain benefits
  • Your circumstances have changed recently
  • You’re a single person (25% discount)

Council Tax Exemptions and Discounts

Check if you qualify for any exemptions or discounts that could reduce your liability:

Full Exemptions

  • Properties occupied only by full-time students
  • Empty properties undergoing major repairs
  • Properties occupied only by people with severe mental impairments
  • Diplomatic properties

Discounts Available

  • 25% single person discount
  • 50% discount for properties with only one liable person
  • Disabled band reduction (reduction to lower council tax band)
  • Empty property discounts (varies by council)

Protecting Your Rights During Enforcement

Know your rights if councils take enforcement action:

Bailiff Rights and Restrictions

  • Must show proper identification and authority
  • Cannot enter between 9pm and 6am
  • Cannot break down doors on first visit
  • Must consider vulnerable circumstances

Challenging Enforcement Action

  • You can challenge liability orders in court
  • Bailiff complaints can be made to their certification body
  • Councils must consider exceptional hardship
  • Professional advice available from debt charities

Getting Professional Help

Free professional advice is available if you’re struggling with council tax arrears:

  • Citizens Advice bureaux
  • Local authority welfare rights teams
  • National Debtline
  • StepChange Debt Charity

Preventing Future Council Tax Problems

Once you’ve resolved your current arrears, take steps to prevent future problems:

Budget Planning

  • Set aside money monthly for council tax
  • Consider 12-month payment plans if available
  • Build a small emergency fund for unexpected bills
  • Review your budget regularly

Stay Informed

  • Keep your council informed of address changes
  • Report changes in circumstances promptly
  • Check annually if you qualify for discounts or exemptions
  • Set up direct debit payments for reliability

Falling behind on council tax is serious, but there are solutions available. The key is taking action early, communicating with your council, and seeking professional advice when needed. Remember, councils prefer payment arrangements over expensive enforcement action, so don’t wait until the situation becomes worse.