Can I Write Off Council Tax Debt?#
It is possible to get council tax arrears written off in some formal debt solutions, although this depends on your full circumstances and how creditors vote. This means that if you have built up council tax debts, some of these arrears may be included in an Individual Voluntary Arrangement (IVA).
Council tax debts work differently to other unsecured debts. When a council is owed money, it can apply to the magistrates’ court for a liability order. Once a liability order is granted, the council can use enforcement agents, deductions from wages or benefits, or other recovery action.
The bailiffs add on their own fees and you will receive a low valuation for the goods in your property.
Have You Recently Been Contacted Regarding Outstanding Council Tax Debt?#
Before you descend into panic, you should know that council tax arrears are common and there are practical steps you can take. If you have 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 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 practical advice, so you know exactly what you can do to fix the situation before it spirals further out of control.
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 after a liability order
- Deductions from wages or benefits
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.
When you first receive contact about council tax arrears, get in touch with us. We will be able to provide you the support that you need to keep bailiffs from accessing your property and the issue escalating.
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, which may lead to a liability order, income deductions, and bailiff enforcement
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 enforcement agents may:
- visit your home
- enter your home only if they gain peaceful entry
- remove goods from your house
- clamp vehicles at your property
- add enforcement fees to the amount you owe
Which debt collectors and bailiffs collect council tax debts?#
Council tax arrears may be chased by a debt collector, enforcement company, or another recovery firm depending on the stage of the debt. Common names include:
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.
Councils normally act quickly, so you should not assume old council tax arrears will simply disappear. Once a liability order has been made, councils may continue recovery action. If you think the arrears are wrong or too old to enforce, get advice before making or refusing 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 is unlikely that you will go to jail for council tax arrears, you should treat any committal warning as urgent and get independent debt advice.
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.
There are several possible ways to stop or pause enforcement, including agreeing a payment plan with the council, using Breathing Space through a debt adviser, or entering a formal debt solution where suitable. An Individual Voluntary Arrangement (IVA) may help if the arrears are part of a wider debt problem.
Once an IVA is approved, creditors included in it must usually stop enforcement. If goods have already been taken or enforcement is imminent, get advice quickly because timing matters.
What’s an IVA?#
If you’ve built up council tax debt, some arrears may be included in an IVA. An IVA is not the only formal route that can write off debt, and it is not right for everyone, but it can be suitable where council tax arrears sit alongside other unsecured debts.
With an IVA you usually pay an affordable amount toward your debts for 5 or 6 years. At the end, remaining included debt is written off if the IVA completes successfully.
So when council tax arrears are included in an Individual Voluntary Arrangement, it may be possible for part of the arrears to be written off.
Still, there are some basic requirements you’ll need to meet…
Basic Requirements for an IVA#
- You normally need a meaningful level of unsecured debt, often around £7,000 or more across your creditors.
- You need a stable income and enough monthly surplus to make an IVA payment.
- Creditors vote on the proposal, so acceptance is never automatic. Your insolvency practitioner will explain how your council and other creditors are likely to assess it.
Think you might qualify? Use our IVA calculator to find out if you can write off your council tax arrears and other debts. Takes 2 minutes.
Get IVA Advice Today#
Council voting behaviour can vary and past approvals are not a guarantee. If council tax arrears are part of your debt problem, the useful question is not only “will the council agree?” but whether the whole proposal is realistic, affordable, and fair to all creditors.
If your arrears are already with enforcement agents, take advice before offering a payment you cannot sustain. A short-term promise that fails can make the situation worse.
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 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)
- debts being chased by collectors or enforcement firms; e.g. Moorcroft collection guide, Lowell, Bristow and Sutor, Cabot collector guide, Advantis debt guide, and PRA Group debt guide.
- previous utility supplier debts; e.g. gas, electricity, water
- previous service providers e.g. digital TV, mobile phones, landlines
- shortfall debts after a vehicle or property has been repossessed
- 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, you may qualify for an IVA if council tax arrears are part of a wider unsecured debt problem.
But time is of the essence. If enforcement agents are involved, get advice before goods are taken or a controlled goods agreement is signed.
IVA Frequently Asked Questions#
When you miss your first council tax payment, the council will start a collection process.
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.
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.
If this isn’t paid, the council may apply for a liability order and then refer the account to enforcement agents. A council tax liability order is not the same as a normal CCJ.
Enforcement agents must usually give at least 7 days’ notice before a first visit. They may then visit and take control of goods if the debt is not dealt with.
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 may need to consider a formal solution such as bankruptcy or an IVA. Both can have serious consequences, so compare the options before choosing.
It is not guaranteed that your council will agree to an IVA. Your insolvency practitioner will explain how creditor voting works and whether the proposal looks realistic.
Enforcement agents can take control of goods in order to repay council tax arrears, but they must follow the rules on entry, notice, protected goods, and fees.
The council will need to follow a strict process and abide by this. This usually includes:
- Reminder letters
- Annual bill in full, with a pre-action letter
- Liability order applied for
- 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.
To be eligible for an IVA you will need to have over 75% of your creditors agree to the proposal.
Some councils approve IVAs and some reject IVAs. Your wider creditor mix, affordability, and proposal quality all matter.
Need help with council tax arrears? Start the IVA calculator to see if you can write off your debt and stop bailiff action. Takes 2 minutes.