Last Updated on March 3, 2023
No one likes to pay taxes but they are a must. Just as your council tax debt. Council tax debts are treated as a ‘priority debt’. And since it’s a priority debt there can be serious consequences if you don’t repay them in time.
What is Council Tax Debt?
Council tax is a tax imposed on households by local authorities in Britain. The amount of the council tax is based on the estimated value of a property and the number of people living in the property. And if you don’t pay them from time to time it’ll stack up as a debt which is known as a council tax debt.
In short, it’s a tax on your home. Most households have to pay council tax. The amount of tax depends on the value of your house, people who live with you and your age and income.
How You Can Pay Your Council Tax Bill
There are different ways to pay your council tax bill. You can choose the way that suits your needs and pay your tax debt.
- You can pay the complete amount in one lump of sum with a check at your local council office.
- You can pay it by direct debit over a period of 10 months.
- You can pay it with a Giro bank transfer.
- You can pay it in cash using a payment card.
- You can pay it weekly/monthly at the counter of the local council office.
- You can pay it weekly at the local housing office if you’re a council tenant.
An annual bill will be sent to you every year in March which will include the amount you need to pay.
You can pay the bill with an extended time of 12 months. Council tax bills will probably show payments over 10 months. But you can extend the time to 12 months by talking to your local authority.
You might receive your bill in late April in certain situation such as you moved your house. In that case, you’ll have less time to pay it. The bill is to be paid off in full before the end of the upcoming March. In short, you’ll have to pay your year’s council tax arrears before the end of the upcoming March.
Consequences of Not Paying Council Tax
You’ll get a reminder letter if you’re more than 14 days late paying your council tax installment. If you pay the installment within the next 7days you can continue paying your council tax installments.
But failing to make the payment within those 7 days can result in your local authority asking you to pay the whole council tax for the rest of the year.
You’ll get another 7 days to make that payment. If you don’t pay the amount in the given time, the local authority may take legal action to recover the tax you owe. If you still resist paying, the council can get your employer to pay your unpaid council tax direct from your wages.
The council can also recover the unpaid tax from the benefits such as income support, pension credit, employment and support allowance, jobseekers allowance etc. The collection process for tax council arrears also includes home visits, repossessions, removal of goods, right to force entry, country court proceedings.
Write Off Council Tax Debts
The councils are within their rights to collect debts owed to them for an unlimited amount of time as there is no limit to how far back the council can enforce debt on your council tax arrears.
But depending on who your council is and how they vote in a creditors meeting, you can get your council tax debt to be written off. So, if you’ve built up council tax debts, a large percentage of those arrears can be eliminated through an Individual Voluntary Arrangement (IVA).
Reducing Your Council Tax Amount
There are some ways to reduce the amount of your council tax bill.
- You may get a 25% ‘Single Person Discount’ discount if you live on your own. Some people such as full-time student, apprentice and someone who is severely mentally impaired aren’t counted when working out council tax.
- If you have a low income, you may qualify for the ‘Council Tax Reduction’ where your bill may reduce based on your income.
- You’ll get extra council tax reduction if you’re above pension age.
You can contact your local authority to know more about how you’ll be billed and if you’re eligible for any reduction.
Council Tax Debt is considered as a priority debt and neglecting it may result in serious consequences. So, be sure to pay your council tax installments from time to time so that you don’t get into any troubles.