Council Tax question

Lostmyway

Hi
After a year in a (I believe mis sold ) IVA I took the decision to go bankrupt and I've got to be honest it was the best decision I've ever made. However the local council seem to be having difficulty accepting things and keep sending letters demanding council tax. The 1st was addressed to me which I sent back with an explanation. The 2nd was to my ex wife of 7 years which I again sent back telling them I am single. Now they sending them to my 19 year old daughter! Can they do this? Her name is not on my tenancy agreement and to be honest I'm lucky if I see her at home twice a week so she hardly even lives here although she is registered on the electoral register. The council seems to be like a dog with a bone looking for what they call a liable party.
So my question is can they hold my daughter liable for the council tax?
Any help would be appreciated

Thomas_The_Tank_Top

Don't all adults living in the household have a council tax liability?

We all have to pay this.

TheGardener

That's an interesting question - can another adult in the house be held liable for the CT if the named householder is BR? I don't know the answer but would be very interested to know too. I should imagine a non BR spouse would indeed be liable but an older child is a different matter - is the daughter a student or if working, would she be eligible for Housing/council tax benefit?
I'm not surprised councils are looking for a way to chase a CT liability - they will be legally obliged to get the most they can for the public purse.

TheGardener

Thomas_The_Tank_Top wrote: »

Don't all adults living in the household have a council tax liability?

We all have to pay this.

As a provable debt - CT for the current financial year (of the BR) is included in BR.

NotEvanAPot

When was your BR order, and are you discharged? If you go bankrupt, the only year included is the current year of the order, so after April 2015, you would be liable from April 2016 onwards. Liabilities from previous years can be included.

Regardless, if any adult resides in the property who would be liable for council tax (not currently claiming relief/reduction or excluded), the local authority has the legal option to pursue the full amount. Depending on daughters age and when your BR date fell, this could limit what she would be liable for.

Lostmyway

Ok thanks. I was declared br on 4th July this year. The council tax they are chasing is from the previous year ( when I was in the doomed IVA) plus this years that have been put into the bankruptcy too. My daughter is 19 and works in a bar part time. She's not a student or anything.

unforeseen

I think you will find that your daughter or any other adult living in the house at the time is possibly liable to pay (both this year and last year?)

To establish who the person is who is liable for the payment of Council Tax, there is a set 'hierarchy'.
This hierarchy is set down below; look down the list and as soon as you reach a description that applies to a person in your home, they will be the person liable for the Council Tax.

• A resident freeholder (so for owner-occupied property the owner is liable)
• A resident leaseholder (this includes assured tenants under the housing act 1988)
• A resident statutory or secure tenant
• A resident licensee
• A resident
• The owner (this applies where the dwelling has no residents)

A resident is a person of 18 years or over and lives in the dwelling as their only or main home.

I think being BR just shifts the liability to the next qualifying person rather than wiping it out

ETA

From bankruptcy manual bit in bold is relevant

40.101 Council Tax
(Amended January 2014)
Each District Borough Council levies and collects a tax, called a council tax which is payable in respect of dwellings in its area. The occupiers of the dwellings have joint and several liability for council tax. The rules for the collection of council tax are found in the Council Tax (Administration and Enforcement) Regulations 1992 URL="http://www.insolvencydirect.bis.gov.uk/technicalmanual/Ch37-48/chapter40/part6/Notes/Notes.htm#3"][COLOR=#0066cc]Note 3[/COLOR][/URL.
At the beginning of the year the local authority issue a ‘demand notice’ in respect of the property URL="http://www.insolvencydirect.bis.gov.uk/technicalmanual/Ch37-48/chapter40/part6/Notes/Notes.htm#4"][COLOR=#0066cc]Note 4[/COLOR][/URL. This notice is an estimate of the council tax due based on the assumption that the tax payer will be in residence for the entire billing period and that the property will remain in the same council tax band. The ‘demand notice’ sets out how much an occupier should pay and when the payments should be made. This is usually by 10 instalment payments.
For the purposes of bankruptcy from 1 April the assumptions upon which the demand notice is based create a contingent liability and the whole of the (unpaid) amount for the year in which the bankruptcy order is made will be provable debt in the bankruptcy. This applies whether or not the bankrupt is in arrears at the date of the order.
As the liability is joint and several whilst the bankrupt will enjoy relief from the liability to pay council tax for the remainder of the financial year the liability to pay remains with the other occupants of the property.
If an occupier fails to make a payment set out in the ‘demand notice’ the council will issue a reminder letter. The tax payer will then have 7 days from the date the reminder was issued to pay the instalment amount. If the payment is made within the 7 days further payments will fall due as per the demand notice. Failure to pay the instalment within the 7 days will render the entire years remaining council tax liability due and payable 7 days after the date of the failure (i.e. it all becomes due and payable14 days after the date the reminder was issued) URL="http://www.insolvencydirect.bis.gov.uk/technicalmanual/Ch37-48/chapter40/part6/Notes/Notes.htm#5"][COLOR=#0066cc]Note 5[/COLOR][/URL.
If a further instalment is missed a second reminder will be issued giving the tax payer 7 days to make the payment. The consequences of the second reminder are the same as for the first.
Upon the issue of a third reminder the entire years remaining council tax liability will become due and payable immediately, a 7 day period is not allowed to make the outstanding payment URL="http://www.insolvencydirect.bis.gov.uk/technicalmanual/Ch37-48/chapter40/part6/Notes/Notes.htm#6"][COLOR=#0066cc]Note 6[/COLOR][/URL.

NotEvanAPot

If your daughter was residing at the property on 31 March 2016 and has remained there since, ANY liability for 2015/16 and 2016/17 has transferred to here and is payable fully. There is a chance if no payment has yet been sought from her that monthly payment is still possible, but the option to pay monthly can be withdrawn by the local authority and full annual amount sought if communication does not start and payment schedule maintained.

The local authority may be willing to accept a retrospective application for council tax benefit based on her lower income from now on for this years liability, but the 2015/16 outstanding amount is now legally her debt. Your circumstances will not be relevant if you continue to be self employed, only if you become unemployed and are in receipt of benefits.

Not intended to scaremonger on the point, but the penalties for non-payment are harsh and easily available to read about via Google. Do not ignore this, speak about it fully with her, as she needs to be aware that avoiding attempts to contact her and seek payment can lead to court proceedings, costs, attachment of earnings orders and in the worst case scenario, criminal charges.

Lostmyway

Oh man
So if she's on the electoral register at this address she's liable? She maybe only spends 1 or 2 nights a week here, the rest of the time she stays at her boyfriends parents house.....
Would that make any difference?

Thanks for the replies by the way

NotEvanAPot

Would make no difference, and if she's been registered there last year and this, it isn't something that can be hidden. Local authority seem to have connected the dots, so your daughter needs to start communicating with them quickly to have a chance of paying monthly. Once that option has been removed, they are likely to apply for a liability order at county court level and seek the full amount.

My advice would be speak to your local authority housing and council tax benefits team. Last years full liability will be chased, but she could apply for a reduction based on income now.

Kim_13

If the OP is not liable to pay council tax this year due to BR, shouldn't the OP's daughter be able to get the single person discount, as she is the only person liable to pay?

Daughter would have to officially move in with boyfriend and his parents to not be liable for the council tax, but that would be from the date she moved out and she would still owe the arrears for the time she was a resident (even if only part time.)

A friend does similar to the OP's daughter and her mother ends up with the full bill (widowed a few years ago.) She isn't eligible for the discount because my friend is sometimes there and while not named on the house deeds, is eligible for council tax purposes.

CT is quite unfair in situations such as this. Even with the discount, a single person has to pay 75%, while a council tax bill is based on 2 adults.