DRO and Council Tax Question

smallandcute

just a quick question as i am still trying to get all my figures together for my debt and completeing the paperwork, is the council tax automatically taken into account as a debt and included in the DRO, i am getting a lot of conflicting information about this. thanks.

National_Debtline

Hi smallandcute,


If you have council tax arrears they will be included in the DRO as long as the council has 'called the debt in' before the DRO begins.


This means the council has withdrawn your ability to pay in instalments for the year and have requested the full bill by serving a final notice or reminder notice. If this is not complied with then the council can potentially go to court for a liability order and the debt can be included in the DRO. I hope that helps clarify things.


Laura
@natdebtline

CIS

It also pays to remember that you only have the right to instalments withdrawn if you fail to pay the amount requested on the reminder within 7 days - it's only at the end of the 7 days where the full amount becomes due.

Craig

DorisTrousers

Depending where you are in the preparation of a DRO application, it is possible to include the coming years bill into the application as well. Most, not all, Councils will take away the right to pay by instalments when 2 payments are missed, meaning the debt is due in full and can be included in the DRO.

I would be happy to do that if I were your intermediary to give you some more breathing space, but do bear in mind that an expense cannot be allowed if you are not paying it, so could effect your eligibility. My own experience suggests that this is unlikely though.

smallandcute

Ok so i have the paperwork from my charity and am in the proccess of going through the mountin of bills to get account numbers, debt collection agency details etc.

With council tax i have been paying my one pound so that i am showing willing to pay as the last thing i want is to hauled in front of a judge and the council making out i am refusong to pay. This payment is being made direct to the council and not the collection agency even though the council will not bring the debt back to them.

My rates have gone up by 4.5% for this coming tax year and first payment is due on the 14th. If i get my paperwork together by the 6th, of course it needs to reviewed etc and i need to make payment for my DRO will it be included or should i wait for the 14th plus seven days? No way can afford this increase and i dont want to draw the process out for any longer then needed.

If you dong want to post your suggestions here on what yoh think i should do then please message me. Thanks for all your help.

CIS

With council tax i have been paying my one pound so that i am showing willing to pay as the last thing i want is to hauled in front of a judge and the council making out i am refusong to pay

If it got to that stage then there's no guarantee a magistrate would consider £1 reasonable in respect of council tax - on the plus side it's still a little way away before it could go for a committal hearing.

included or should i wait for the 14th plus seven day

It's not 7 days from when the payment is due - it's 7 days from when the reminder notice is issued. They could issue the reminder the on the 15th but they may not issue it straight away.

Craig

National_Debtline

Hello again,


I understand this is a very difficult situation and realistically I would suggest you speak to your Intermediary with regards to the new council tax bill. However, even if you do wait to submit your DRO (to the point where you can include the tax year 2017/18), you will still have to pay the council tax next April (2018). That will be the same monthly expense that you are expected to pay this year, if not more.


The DRO is designed to write off debts so that you can maintain your ongoing bills. If you cannot maintain your ongoing bills then your Intermediary needs to be help you further with your budget. Looking at further benefits you can claim and what non essential expenses you can cut back on. If you have already done all of this, you may need to consider more drastic lifestyle changes (moving to smaller/ cheaper property etc). It is difficult to say what is best without seeing your SOA.


Remember, that you can only have 1 DRO per 6 years so you need to make sure that this process will help you be debt free, long term. Good luck,


Laura
@natdebtline

fatbelly

At this time of year (April) if your creditors are not aggressively pursuing you, by using bailiffs or similar, and you are not near the 20k limit, then it makes sense to hold on until the present year council tax can be included. I have covered the rules relating to DROs and council tax here

https://forums.moneysavingexpert.com/discussion/comment/72293777#Comment_72293777

CIS

It shouldn't be more than a month before the council have issued a reminder notice and that reminder passes the 7 day period to lose the instalments so holding on may be best if the situation allows it.

Craig