Council tax

antreedv13

Hi I was declared bankrupt in May 2014 for 12 months until May 2015. I had a property that was handed to an LPA receiver until the property was sold in March 2015. I now have a council tax bill from October 2014 to March 2015. Am I right in thinking that as I was still in my 12 month bankruptcy that I am not liable for the council tax owed? Also as I was dispossessed from the property & therefore not in possession I am again not liable? Please let me know your thoughts. 

CIS

antreedv13 said:

Hi I was declared bankrupt in May 2014 for 12 months until May 2015. I had a property that was handed to an LPA receiver until the property was sold in March 2015. I now have a council tax bill from October 2014 to March 2015. Am I right in thinking that as I was still in my 12 month bankruptcy that I am not liable for the council tax owed? Also as I was dispossessed from the property & therefore not in possession I am again not liable? Please let me know your thoughts. 

For council tax purposes bankruptcy/LPA receivership does not remove you from liability on a property, even though a LPA receiver is in charge of managing the property you are still the owner and liable for any council tax charge which falls on to the owner. It is a common issue and unfortunately not a point you will be able to argue on.

Was the property actually repossessed ? If so you can be in a far better position.

The fact that the bankruptcy lasted 12 months is not relevant - what is relevant is the debt covered under the bankruptcy. Typically a new debt from the date of bankruptcy is a fresh debt but council tax is slightly different in that a debt for the remainder of the council tax year can be included in some cases (even though the period falls after the date of the bankruptcy).

Unfortunately there's not enough information in what you have posted to say for certain but I suspect I know what they may have done. You could have problems on your hand with arguing this one as what I suspect the council has done is to create a new council tax account from the date of date of bankruptcy. They will likely argue that this therefore is not a debt that existed at the time of the bankruptcy and therefore cannot be included. This is likely to get technical if this is the case but it depends on how much the council want to argue - I've known plenty who do and plenty who don't.

antreedv13

The council tax for the property is the same number as before & the council tax year is April 2014 to April 2015. Also like I said previously even though it was in the hands of a LPA receiver & still in my name, I was not allowed to collect rent or have any other dealings with the property. Therefore I was not in possession of the property.

CIS

Also like I said previously even though it was in the hands of a LPA receiver & still in my name, I was not allowed to collect rent or have any other dealings with the property. Therefore I was not in possession of the property.

That makes absolutely no difference for council tax - you are still the legal owner & liable (It is a matter of legislation - just because one piece does something for it's own purposes doesn't stop another piece doing something different for it's own purposes). This same issue has been raised and settled by the tribunal on multiple occasions.

The council tax for the property is the same number as before & the council tax year is April 2014 to April 2015.

Then that raises the chance of arguing over the charge and it being covered in bankruptcy.