Council Tax Arrears - Priority of Liability Orders?

Hi.

I'm in arrears with Council Tax and have two liability orders from 2011 and 2012. I'm also in arrears for 2016 but no liability order has been issued yet.

I'm paying these off, and trying to get my house in order.

The 2011 and 2012 liability orders have been passed to a DCA. I've agreed to pay them £150 a month until they're settled.

Thing is - the Council have decided that they'll offset my £150 per month payments that I've given to the DCA (which the DCA have forwarded to the Council) against this years Council Tax bill. So my arrears on the 2011 and 2012 bill isn't coming down yet.

This has got me a little concerned. Can they do this? Shouldn't the Council be offsetting the payments against the 2011/12 bills?

Any advice / suggestions appreciated.

Comments

  • I would be asking myself first why priority debts such as Council Tax are not being paid? There may be a number of reasons for this, other debts, low income etc etc but that is a key issue.
  • CIS
    CIS Posts: 12,260
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    edited 30 June 2016 at 4:00PM
    There is nothing specific in legislation about the priority of Liability Orders (except for Attachment of earnings/benefits).

    What the local authority should do is as much as possible put the debts where the tax payers wants the money to go or where it is - other than that the council are under no real obligation.

    If is a debt collection agency they are using or an enforcement agent - it's a big difference. That being said if it's coming from any debt collection or enforcement agency then they should be allocating it to that debt.

    I've just recently come across a nice piece of case law on debt allocation that I intend to use in future when I issue letters for my clients - an advantage of having more time on my hands to do research !.
    I no longer work in Council Tax Recovery but instead work as a specialist Council Tax paralegal assisting landlords and Council Tax payers with council tax disputes and valuation tribunals. My views are my own reading of the law and you should always check with the local authority in question.
  • CIS
    CIS Posts: 12,260
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    Carlos_UK wrote: »
    Hi.

    I'm in arrears with Council Tax and have two liability orders from 2011 and 2012. I'm also in arrears for 2016 but no liability order has been issued yet.

    I'm paying these off, and trying to get my house in order.

    The 2011 and 2012 liability orders have been passed to a DCA. I've agreed to pay them £150 a month until they're settled.

    Thing is - the Council have decided that they'll offset my £150 per month payments that I've given to the DCA (which the DCA have forwarded to the Council) against this years Council Tax bill. So my arrears on the 2011 and 2012 bill isn't coming down yet.

    This has got me a little concerned. Can they do this? Shouldn't the Council be offsetting the payments against the 2011/12 bills?

    Any advice / suggestions appreciated.

    Carlos_Uk - I've sent you a PM.
    I no longer work in Council Tax Recovery but instead work as a specialist Council Tax paralegal assisting landlords and Council Tax payers with council tax disputes and valuation tribunals. My views are my own reading of the law and you should always check with the local authority in question.
  • National_Debtline
    National_Debtline Posts: 7,998
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    Hi Carlos_UK,


    This does seem to be a very strange situation. Firstly, the council will very rarely use a debt collector to chase council tax arrears, in this situation the odds are that it is enforcement agents/bailiffs you are dealing with. If you have ever let these bailiffs into your home or signed a controlled goods agreement you should seek independent, free advice ASAP. If you haven't, then just remember the golden rule, which is do not let the bailiffs in, keep the doors locked, and hide anything valuable outside.


    As far as the payments are concerned I would suggest you make a formal complaint to the council and to the bailiffs - depending on where you are sending your payment. If you are sending the money to the bailiffs then they should split the payment proportionately between the debt and the fees that they have in their control. If they are sending it back to the council (which is odd) then the council should do this. The council should not make their own determination about what to use the money for (especially when there isn't even a liability order for this years debt).


    Complain to the council and escalate it to the Local Government Ombudsman if necessary. Good luck,


    Laura
    @natdebtline
    We work as money advisers for National Debtline and have specific permission from MSE to post to try to help those in debt. Read more information on National Debtline in MSE's Debt Problems: What to do and where to get help guide. If you find you're struggling with debt and need further help try our online advice tool My Money Steps
  • CIS
    CIS Posts: 12,260
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    It appears it's not an issue with debt apportionment with the enforcement agent, they should sort that out before the council see the payment, it's an issue with allocation at the council when they receive the payment.

    Where they are clear payments are from a specific source, in this case an enforcement or DCA (which is unusual), and they are aware that a particular liability order is with that agent then they should be allocating payments to that debt (as per case law).

    There's no point complaining to the enforcement agent/DCA if they are passing the payment to the council and the council are allocating the payment against a liability order balance - once the monies are passed to the council it's them who are allocating it.

    A complaint to the LGO is a possibility but he needs to speak with the council first and use their complaints process before considering the LGO.

    A request to the council first for the situation to be remedied will be the best course, followed by a formal complaint if you're still aggrieved and then a complaint to the LGO if not remedied.
    I no longer work in Council Tax Recovery but instead work as a specialist Council Tax paralegal assisting landlords and Council Tax payers with council tax disputes and valuation tribunals. My views are my own reading of the law and you should always check with the local authority in question.
  • dancingfairy
    dancingfairy Posts: 9,069 Forumite
    Its better for you to keep this year's up to date and pay less to older years. When the council goes for liability order it will cost you an extra 100 pounds or so. If it goes to bailiffs they can add a couple hundred more.
    They've probably added all the fees for the older years that they are allowed to so leaving it whilst prioritising your current years payments is actually probably quite sensible.
    It might be worth having a chat with someone like stepchange or national debtline as they can help with which debts are priorities ( and which aren't) abd help set up payment plans.
    Df
    Making my money go further with MSE :j
    How much can I save in 2012 challenge
    75/1200 :eek:
  • CIS
    CIS Posts: 12,260
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    Forumite
    Its better for you to keep this year's up to date and pay less to older years. When the council goes for liability order it will cost you an extra 100 pounds or so. If it goes to bailiffs they can add a couple hundred more.
    They've probably added all the fees for the older years that they are allowed to so leaving it whilst prioritising your current years payments is actually probably quite sensible.
    It might be worth having a chat with someone like stepchange or national debtline as they can help with which debts are priorities ( and which aren't) abd help set up payment plans.
    Df

    I can see where you're coming from but the problem with that is if it's not paid and the council decide to progress recovery on to the next stage of bankruptcy or committal - having to try and argue the case at the point isn't going to be easy.

    In any case the council are acting wrongly. The enforcement agent collects a balance in respect of a particular liability order - the monies are, in law, only authorised to be collected in payment for that specific debt by the enforcement agent. Where payment is collected for a specific debt the council have no legal powers to pay the monies elsewhere.
    I no longer work in Council Tax Recovery but instead work as a specialist Council Tax paralegal assisting landlords and Council Tax payers with council tax disputes and valuation tribunals. My views are my own reading of the law and you should always check with the local authority in question.
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