Council Tax Arrears + Bankruptcy

Big_Smurf

I really hope someone can offer me some advise.

If I'm honest I've been burying my head in the sand over the last few months. It's only now that my girlfriend is moving in with me that I've built up the courage to face my problems and they are worse than I thought. Whilst the amount of debt I owe is not as big as some I've seen on this forum, it's the kind of important payments where I've screwed up. Basically council tax and mortgage.

I'm only three payments behind on my mortgage, and these bounced payments haven't been consecutive months, I'm fairly confident I can reach a deal with my mortgage company over these.

It's the council tax that's really worrying me. I've spoken to the council and they have advised I have £2,500 in arrears. They are in the process of trying to arrange a bankruptcy hearing. They advise that the only way I can stop this is to pay half the debt before the end of the month and the rest by the end of February. Earning £1200 a month and having a mortgage + other bills makes this near impossible. I just don't know what to do.

Can anyone give me some direction as to how I should handle this?

I can't afford to be made bankrupt as ,ironically, I work in the financial industry. As we are under FSA guidelines, if I am considered bankrupt, I am no longer able to work for my company and pretty much become unemployable in my chosen profession.

Help me. Please.

Smurf

**purpleprincess**

What I would advise is to write them a lettter, detailing your income and your outgoings and a reasonable amount for repayment and send this to them. A day or two after you've sent it ring them and ask them if they are willing to accept the arrangement. Keep getting in touch with them about payment. And also, START MAKING PAYMENTS to reduce this balance.

Basically, it costs them a lot to get you made bankrupt, not just in the proceedings but they also lose the money as it gets written off.

You must make sure that when you make an arrangement with them that you stick to it, this will be your last chance.

Additionally, remember that your new Council Tax starts at the beginning of April and you must pay this as set out on the bill. Set up a Direct Debit if you can, this means that this will just continue through the year and you don't have to do anything about it and then pay the arrears separately.

Hope this helps and good luck

Big_Smurf

Thanks for your advice PurplePrincess. I'll give it a go. Do you think I should write to their legal dept. or to the general council tax address?

dfwz

I had a similar amount of council tax debt and when I called them up they were happy to accept a repayment plan that I could afford.

Big_Smurf

Well I've now got the email address for the person in the legal department so I'll sit down tonight and work out budget etc and contact her. I'm hoping that they'll realise that should I be considered bankrupt I will lose my job and will then be another person on the social who still can't afford their council tax!

It feels really good talking about it! I'm glad my girlfriend has been so understanding as well.

I just discovered this as well:

http://www.ipswich.gov.uk/Angle/Tax+dodgers+beware.htm

Smurf.

Big_Smurf

Well, I approached the council and got this in response:

The request to repay this debt within 2 months is reasonable as from 1 April
2007 you will be liable for a new Council Tax bill.

I am mindful of the difficulties your employment brings to you regarding
Bankruptcy, however I would echo Mr Upson's statement that as the
owner/occupier of the property you are responsible for payment of the
Council Tax due.

The Bankruptcy petition has been issued at Ipswich County Court and I am
currently awaiting for a Hearing date.

Looks as though I'm !!!!!!ed. The bit about my employment is because I work in the insurance industry in an FSA regulated area. One sniff of bankruptcy and I'm sacked and enemployable and told them this.

Anybody got any advise as to what I can do now? I'm terrified.

Smurf

plumduff-2

You need to find this money - one of our local councils is using the BR sanction for non payment and it is prooving very very lucrative to them to do so...

If you can get this bill to less then £750, then they cannot make you BR... but ignore this threat at your peril, cos they will do it and your house will be at threat..

You dont say whether you are paying off any other debts/bills at this time.. if so, you may be best to ignore everything else and concentrate on paying off this debt or at least getting it under the £750 limit...

Credit cards..? etc... you may have to max them out... You can deal with repaying them later..

Well after dealing with the mortgage arrears which should be next on your list... but seeing as the BR could potentially leave you homeless, the CT needs immediate action... beg borrow or steal is my advice... (well, not the stealing obviously...!)

newcook

It might be an idea to speak to one of the supervisors who has more authority. some of the people who work at the council tend to let their job go to their head and if they can belittle people to have that bit of extra power they will.
the supervisors are normally quite nice folk - its not that you dont want to pay them, you just cant afford to do it in one lump sum but could perhaps make the repayments over 5 months?

Big_Smurf

Thanks for your response. Luckily I haven't any other debts at the moment, they've all been paid off. It's just the sheer amount they are asking for. I have actually just spoken to a loan company who will lend me the money. Not ideal, but it's better than being jobless and homeless I suppose.

plumduff-2

Definately, and whilst the other advice is normally sound, a lot of councils these days are looking at BR in order to settle old debts.. and once they start the BR proceedings they will not back down... as they are pretty much guarenteed their money in BR if you have equity...

You cannot afford to mess about in the hope you get to speak to someone reasonable, my experience is that you will not and then leave things to late...

Good luck.