Coping with council tax debts
October 10, 2014
Council tax has to be paid by everyone living within a particular area of Scotland or the UK in order to fund local services. Amounts owed by particular households are calculated on an annual basis and are then generally due to be paid on a monthly basis until settled in full.
Owing council tax isn’t generally a cause for financial concern but if you are struggling to settle other debts, or make ends meet, then it can be tough to keep up with payments.
What to do if you can’t pay your council tax
If you are unable to pay your council tax bills for any reason then it’s important to call your local council and to explain the situation you’re in. There’s a good chance that you can reach an arrangement with your council’s finance department to spread the payments of money you owe over an extended period of time.
If you continuously fail to meet your council tax obligations and you rack up arrears over a period of months without explanation then it’s likely that you will be obliged to pay the amount you owe for the entire year upfront rather than in instalments. Where requests for these payments go unheeded, your council can ask a Magistrates’ Court for a Liability Order against you which demands that you settle your debts and pay costs for the processes involved.
What else can happen?
There is scope for councils to retrieve any money you owe them straight from your wages if you continually ignore a court order taken out against you. Or, if you’re on any form of benefits, then you could find that the amounts you receive are reduced in order to see your council tax arrears reduced.
In extreme cases, your local council can instruct bailiffs to seize assets you own in order to cover the debts you owe as council tax arrears. And, if this doesn’t succeed as a means of settling your arrears, then a Magistrates’ Court can apply for a warrant to send you to prison for up to three months.
What debt solutions are available if you can’t pay your council tax bills?
If your council tax bills have become a serious financial headache and you can’t afford to pay off the money you owe then there are solutions available to help you resolve the problems you’re facing. The first thing to do is contact your council and try to reach an agreement with them about when you will be able to pay what you owe.
Unlike commercial lenders, your local council has no direct interest in seeing extra charges levelled against you and having additional amounts added to the debts you have outstanding. All your council wants to see is the money you’re obliged to pay settled in full. So there’s a good chance they will be open to any sensible suggestions or plan of action you can put together that enables the matter to be settled, either immediately or over time.
It’s also very important to get advice from experts on issues around council tax arrears or any other form of personal debt that you’re struggling to deal with. This is particularly true if your inability to pay your tax bills is reflective of much broader financial problems and if you could benefit from entering a Trust Deed or a Debt Arrangement Scheme.
Scotland Debt Solutions provides expect advice and guidance on a full range of personal finance problems and we can help you find relief from creditors however challenging your circumstances are.
Your personal credit score plays an important part in securing new loans and credit, and can affect your financial life for better or worse. Lenders use the information in your credit file to determine whether you present a high risk of default, and if your credit score is low, you may find it difficult to […]
Credit unions offer a range of financial products including current accounts, savings accounts, and loans, and can be a good alternative to banks and building societies whilst also helping your cash flow. There are credit unions all around the UK, almost 100 of them operating in Scotland. They’re not always widely advertised, however, and although […]
It’s a worrying situation when you realise your outgoings exceed your income, and it can be difficult to prevent debt in this situation, but there are solid steps you can take to get back on track – you just need to act quickly. Increasing your income or reducing the money going out are essentially what […]
If you’ve lost your job, state benefits and tax credits can provide vital financial support to see you through this tough time and help you avoid taking on too much debt while you look for more work. As far as your old employment is concerned, it’s important that you check your final wage slip to […]
If you are a Scottish resident in financial difficulty, you may have entered into a Trust Deed in order to restructure debt repayments to creditors. A Trust Deed is a fixed voluntary agreement made between the debtor and creditor, with the help of a trustee. Debt is broken down into smaller, affordable instalments, typically lasting […]
A Debt Arrangement Scheme (DAS) is a government backed scheme which allows you to repay debt through contractual, monthly instalments without the threat of legal action and incurring penalties or interest. The scheme was established in 2004 for Scottish residents in debt, providing an alternative solution to sequestration, the Scottish equivalent of bankruptcy. A Debt […]