Write Off Council Tax Debt

Can I write off council tax debt?

It is possible to get your council tax debt written off, although this depends on who your council is and how they vote in a creditors meeting. This means that if you have built up council tax debts, a large percentage of these arrears can be eliminated through an Individual Voluntary Arrangement (IVA).

Have you recently been contacted regarding outstanding council tax debt? 

Before you descend into panic, you should know that your situation is more common than you might think. In fact, in the 2017-18 financial year, UK council tax arrears amounted to a whopping £944 million! 

But once this debt begins to accrue, it can be tough to know where to turn. And if you’ve recently received contact from your local authority, you may find yourself asking one or more of the following questions: 

  • can I get a council tax arrears payment plan?
  • what happens to council tax debt after 6 years?
  • is it possible to get council tax debt written off?
  • can an IVA help with council tax debt? 

That’s why we’ve put together this know-it-all guide, to answer your questions and provide clear, actionable advice on how to regain control of your debts, starting immediately.

We’ll break it all down for you, with no-nonsense practical advice, so you know exactly what you can do to fix the situation, before it spirals further out of control.  

Let’s get right to it. 

I Owe Council Tax – What Can I Expect? 

You need to know that the collection process for council tax arrears is particularly heavy. 

In fact, your council is likely to use a wide range of enforcement methods to reclaim the money that they’re owed. And if you ignore your council tax arrears, you can expect the following to become realistic prospects:

  • home visits
  • repossession
  • removal of goods
  • enforcement agents visiting your home with the rights to force entry
  • county court proceedings

So What Should I Do? Help With Council Tax Debt

The obvious advice is to repay your council tax debt immediately. Of course, it’s rarely that simple. 

But don’t take the opposite approach. The worst thing to do at this stage is to procrastinate or run away from the issue, in hopes that it’ll disappear. 

Plus, as council tax payments are often spread over a period of 10/12 months, if you act quickly you may still be able to restore your right to make monthly installments. But even if you can’t find a payment arrangement that works for you, showing a willingness to engage with the process can still help you later down the line. 

What Are The Consequences of Not Repaying Council Tax Debt?

Local authorities each deal with council tax arrears slightly differently, but generally, the following process is seen nationwide: 

  • when you miss paying your council tax or choose not to make a payment, your local council sends you a reminder and gives you 7 days to get it paid
  • fail to do this and you can expect to receive a ‘final notice’ that demands payment of the entire year’s council tax
  • if you miss payment following the final notice, then the council can take legal action, that means income deductions and bailiffs 

What Are Income Deductions?  

Once legal action has commenced, the council can get your employer to deduct money directly from your wages. Even if you’re not in employment, money can be taken from other government benefits, such as: 

  • Income Support
  • Pension Credit
  • Employment & Support Allowance
  • Universal Credit
  • Jobseekers Allowance

Council Tax Bailiffs

The next stage is a dreaded visit from the bailiffs. We’re often asked whether it’s likely to be visited by bailiffs for council tax debt. 

The truth? Yes. 

Bailiff visits are a harsh reality of outstanding council tax arrears, and of course this is never a pleasant experience. The good news is that they won’t appear completely out of the blue. In order for Bailiffs to visit, a court order is needed, which means you’ll be notified in advance. You should receive 7 days notice before bailiffs arrive. 

Bailiffs will then try to access your property with the aim of seizing goods to pay towards the debt, on behalf of the council.

It’s possible you’ve already received this notice, and are panicking about what to do. Maybe you’ve even had a visit from a bailiff already. 

If so, we strongly advise that you immediately contact a debt advice service, like IVA Advice. You can do this free of charge, and receive quick, independent advice specific to your circumstances. 

In any case, do not let bailiffs into your house. We can’t stress this enough

Here’s why… 

What Can A Bailiff Do?

Council tax bailiffs have higher powers than debt collectors. 

When a bailiff seizes goods they’ll first make a list of what you own so they can take things away and sell them in the future, if you fail to come to a satisfactory agreement on payment. They’re also notoriously difficult when it comes to negotiating and will likely demand high payment amounts to keep from removing your goods.

Council tax bailiffs have the right to:

  • visit your home
  • enter your home (peaceful entry) with a day’s notice 
  • remove goods from your house
  • clamp vehicles at your property
  • issue county court judgments (CCJs) to your credit file

Which bailiffs collect debts for council tax?

The most common debt collection companies councils use to collect council tax debts are:

If you are being chased by another company for council tax arrears, they can be dealt with the same as the above companies. So continue reading for more information.

I’m Worried – Will Bailiffs Force Entry to My Home? 

Bailiffs are required to gain peaceful access to your home prior to seizing any goods or possessions. So do not let them in.

This means if you have left a door or window open, or if you open the front door; the bailiffs can push their way into your property.

While it’s unlikely that a bailiff will force entry into your house for unpaid council tax debts, they will sometimes enter a property through a door that has been left unlocked. 

Again, it is highly advised to contact a debt advice service that can help you reach a solution that doesn’t involve the surrender of your possessions. 

This is much better than forfeiting your belongings, or hoping they’ll eventually give up. 

Council Tax Arrears – How Far Back Are You Liable?  

You may have heard that council tax debt after 6 years, will be written off.

But is that really the case?

Generally speaking, there is no limit to how far back the council can enforce debt collection on your council tax arrears. This means that councils are within their rights to collect debts owed to them for an unlimited amount of time.

It is true that the council can only pursue a debt for 6 years after the last contact with you. But this usually isn’t an issue for the council, as their systems automatically file a CCJ, and refer debts to magistrates court 7 days after non-payment.

As such, your debt will not be automatically written off after this period.

Can I Go to Jail for Not Paying Council Tax?

You may also have heard stories of people jailed for council tax arrears in the past, and are worried that this could happen to you. 

But is this just scaremongering? 

Here’s the deal – if you completely refuse to pay for your council tax, you may be sent to prison

The term can be as long as 3 months and if you are able to make your arrearage payments and simply refuse to, then your local authority may ask that you be committed to prison. 

However, please remember that this is extremely rare. 

While there have been a few cases within the UK where people were jailed over non-payment of council tax, this is an unlikely outcome. 

Why? 

Because before this can happen the magistrate must be thoroughly convinced that you are ‘willingly refusing’ to pay your tax or that you’ve been ‘culpably neglectful’ in doing so. 

In simple terms, this means you had the means to repay the debt but neglected to do so. And so making regular payment, no matter how small, is a good defence against imprisonment. It shows the magistrates you are sincerely trying. 

Overall, while it’s unlikely that you’ll go to jail for not paying your council tax, there have been many cases in which this has happened. 

As such, you should seek immediate independent financial advice when you fall into arrears with your council tax.

Mention of bailiffs, court dates, and prison, may sound scary. 

If you’re like most, you’d prefer to get your council tax debt under control before things ever progress to this stage. 

Here’s how.

Bailiffs all operate under the instruction of your local authority – which has the power to call them off. With our professional advice, we can often get your local authority to cease bailiff action. Otherwise, expect frequent visits.  

You should not follow advice claiming that you can avoid bailiff action through the use of misleading letters and technical jargon. We have years of professional experience in these matters and the truth is, it doesn’t work. 

In fact, the only way to stop a bailiff in his tracks is to enter into an Individual Voluntary Agreement (IVA). Effectively, this functions as a council tax arrears payment plan, for a fixed period.

Once you’ve entered into an iva, the bailiff can not legally visit your property, and it is possible to eventually get your council tax debt written off. But you have to enter into your iva before they seize goods, so act quickly. 

What’s an IVA? 

If you’ve built up council tax debt, a large percentage of your arrears could be eliminated through an iva. In fact, an iva is the only legitimate way (except for bankruptcy) to write off your council tax debts. 

With an iva you will have to pay back a percentage of your total debts for a period of 5 years. At the end of the 5 years, the remainder of your debt will be completely written off – leaving you debt-free.

So when you include council tax arrears into an Individual Voluntary Arrangement (or iva), it’s completely possible to write off a section of your council tax debt. 

Still, there are some basic requirements you’ll need to meet…  

Basic Requirements for an IVA

  1. you’ll need to have a total debt level of £5000 or over. This must consist of 2 or more creditors (people you owe money to)
  2. you must have a regular income of £800 or above
  3. your council needs to be on our list of approved councils. Some councils will allow you to pay back a small percentage of your council tax debts, others will insist on the full amount. It is important to speak to us to find out how your council votes.

Which Councils Accept IVAs?

The following council offices below are likely to vote yes to your iva proposal: 

  • Bolsover District Council
  • Bolton
  • Brighton & Hove
  • Bristol
  • Bromley
  • Caerphilly
  • Oldham
  • Canterbury
  • Nottingham
  • Newcastle Under Lyme
  • Carmarthenshire
  • Derby
  • Devon
  • East Hampshire
  • East Lindsey
  • Newark & Sherwood
  • Newcastle Under Lyme
  • Hastings
  • Havant
  • Kings Lynn & West Norfolk
  • Kirkless Council (KPMG)
  • Lewes
  • Newport
  • Liverpool
  • Newcastle upon Tyne
  • London Borough of Redbridge
  • Mendip
  • North Kesteven
  • Plymouth
  • Portsmouth
  • Reading
  • Redcar and Cleveland
  • Reigate & Banstead
  • Rochdale Borough Council
  • Rochford
  • Rotherham
  • Rugby Borough Council
  • Rushcliffe
  • South Oxfordshire
  • Stockport
  • Surrey Heath Borough Council
  • Tendring
  • West Lancs Borough Council
  • Wolverhampton
  • North East Lincolnshire
  • Dacorum
  • Rhondda Cynon Taf Council

I Can’t See My Council – What Does That Mean? 

The above list is not definitive but is built from our experience of receiving one or more approvals in the past. 

It does not necessarily mean you can’t get your council tax debt written off. 

So if your council is not listed, please get in touch and we will advise if your debt is eligible to be entered into an arrangement.

Which Debts Can Be Included In Your IVA?

If you have council tax debt, you may also be struggling with other forms of debt, too. The good news is the council tax is not the only debt type that can be addressed with an iva. 

All of the below debts can potentially be included in your iva:

  • council tax (previous years and current year if in arrears)
  • unsecured debts (overdrafts, credit cards, store cards, charge cards, catalogues, payday loans, unsecured loans, doorstep loans, credit unions, debts with CCJ attached to them)
  • bailiff debts; e.g. Moorcroft GroupLowellBristow and SutorCabot Financial, Advantis, and PRA Group.
  • previous utility supplier debts; e.g. gas, electricity, water
  • previous service providers e.g. digital TV, mobile phones, landlines
  • previous debts secured against an asset that has been repossessed
  • vehicle HP and properties
  • debts to family and friends.
  • HM Revenue and Customs VAT, PAYE, Self-assessed tax, National Insurance

Debts That Cannot Be Included In Your IVA

Unfortunately, not all debts can form part of an iva. The below debts are instead factored into your monthly household expenditure allowance.

  • mortgages and secured loans
  • hire purchase payments
  • student loans
  • child maintenance
  • rent & property service charges
  • current utility bills
  • current service providers
  • court fines
  • someone else’s debts

Council Tax Debt Written Off? Get Started Today

While there are some basic requirements and local variations, if you’re struggling with council tax debt, there’s a good chance that you may qualify to enter an iva agreement.

But time is of the essence. You need to enter an iva before your goods are seized. 

To get started right away, click here to use our helpful calculator and begin a FREE assessment of your circumstances.

Frequently Asked Questions

What happens if I miss a council tax payment?

When you miss your first council tax payment, the council will start a collection process.

1) You will be sent a reminder. This will give you 7 days to catch up with your council tax payments in full. If you do not pay within 7 days, you will receive a second notice to pay in full. The council will only give you 2 payment reminders in one financial year.

2) If you miss your payment for a third time, the council will send you a bill for the entire financial year. This must be paid within 7 days.

3) If this isn’t paid, your account will be referred to bailiffs, for collection. a CCJ is usually applied to your credit file, which will last for 6 years.

4) The bailiffs will issue you with a 7 day warning to pay the account in full otherwise they will visit your home and try to repossess items to the value of the balance.

Can my council tax arrears be written off?

The councils do have the power to write off any arrears at their discretion. They will not do this on a voluntary basis though. They follow a very strict collection process which they do not deviate from.

If these debts are unaffordable, you will need to write them off with bankruptcy or an IVA. Both solutions are formal arrangements which will last for a defined term. At the end of the term your debts will be written off in full, leaving you completely debt free.

It is not guaranteed that your council will agree to an IVA, you can check this page for an updated list of councils who have been known to agree to IVA proposals in the past.

Will my items be repossessed for not paying council tax?

Bailiffs have the power to repossess items from your home in order to repay your council tax arrears.

The council will need to follow a strict process and abide by this. This usually includes:

1) Reminder letters
2) Annual bill in full, with a pre-action letter
3) CCJ applied
4) Referred to bailiffs

When the debt is finally referred to bailiffs, they will issue you with 7 days notice before they visit your property. If you are in this collection cycle, you should seek independent financial advice immediately to avoid further action.

Will an IVA help with unpaid council tax debts?

To be eligible for an IVA you will need to have over 75% of your creditors agree to the proposal.

Some councils approve IVA’s and some reject IVA’s. Check our page for the most recent information on which councils approve IVA’s.