Council Tax Debt

Why is Council Tax debt one of the easiest debts to run up?

Well, unlike other debts, such as credit cards and loans, it’s not a debt you agree to take out. It's a local authority charge which we all have to pay when we have a home, unless we are eligible for a reduction, discount or exemption.

This means even if you have avoided taking out other debts, you can quickly fall into arrears when things become difficult.

The first thing to do is get advice, but don’t pay for it.

The second, is be careful who you take advice from.

Some services will tell you they are a free service, but often they are seeking to place you into a product like a Protected Trust Deed or Bankruptcy, where they or a partner agency will make money.

This is not necessarily wrong, but something you should be aware of. There are other options like the Debt Arrangement Scheme, or a Time to Pay Direction, or even dealing with your local authority directly.

Why is it important not to ignore Council Tax debt?

In addition to the fact that you can accrue council tax debt without borrowing any money, and it will increase year on year if it goes unpaid, another reason for not ignoring council tax debt is local authorities have special powers for recovering it.

This means they can use the summary warrant procedure to recover the debt. Summary warrant are the equivalent to court orders.

However, when the sheriff court grants a local authority a summary warrant, there is no court hearing.

Local authorities, however, can then use the summary warrant to execute diligence. Diligence is a legal term in Scotland that is used to describe legal procedures that can be used to recover a debt. Examples of diligence and the most commonly used in Scotland are attachments and earning arrestments.

A local authority can also serve a Charge for Payment once the court has issued a summary warrant. This is important, particularly when you are a home owner, as a Charge for Payment is a formal demand for pyment that gives you 14 days to pay your debt. If you fail to pay your debt within 14 days, you are then legally deemed to be apparently insolvent. Councils can the petition the court for your bankruptcy.

ocal authorities in Scotland have special powers for recovering

Who can help with council tax debt?

There are plenty of free services in Scotland that are extremely experienced at dealing with Council Tax debt such as:

These organisations will automatically check if it’s possible to reduce how much you owe, before suggesting you pay anything.

This involves checking whether you are entitled to:

  • a council tax reduction,
  • a council tax discount: or
  • an exemption from paying council tax at all.

All of these, if successful, can help reduce the amount you owe, even to the extent you might not owe anything.

Contacting your Local Authority

Local Councils are also very helpful in helping you with your council tax debt.

They will often assist you to enter into a repayment plan with them, stopping any further enforcement action.

Where you have other debts or substantial arrears, however, it may be best to seek independent advice first.

Where you have not entered into a repayment plans with sheriff officers, Council's will also usually deal with you directly.

This may mean in addition to paying your normal monthly payments, you make an additional payment towards your arrears. This reduces the amount you owe and also stops further arrears building up.

Ignoring Council Tax debt is never the right answer.

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