Changes could be coming to the way council tax debt is collected

Council tax went up on 1 April, putting additional pressure on many households.

Missing just one payment can quickly snowball into a large debt and councils have the power to take tough action to recover it, including calling in bailiffs.

But the way councils handle council tax arrears could be changing soon.

What happens if you miss a council tax payment?

When you miss a payment, the process usually looks like this:

• You’ll get a reminder – around two weeks after the missed payment.
• If you pay within seven days, that’s it – no further action and you can go back to your usual monthly payments.
• If you don’t pay in time or it’s your third time falling behind this year, you’ll receive a final notice asking you to pay the entire remaining council tax for the year in one go.
• If that goes unpaid, your council may apply for a liability order, which gives them the legal power to collect the debt using enforcement.

This can include:

• deductions from your wages or benefits
• bailiffs visiting your home to seize goods
• securing the debt against your property (if you own it)
• in some cases, starting bankruptcy proceedings (if you owe more than £5,000)

Government to review council tax debt rules

There’s hope that the council tax arrears system could soon change.

The government has announced a consultation into how council tax arrears are managed, with the aim of making the process fairer and more supportive for people who fall behind.

The announcement follows pressure from consumer expert Martin Lewis. Co-presenting Good Morning Britain (GMB) today (14 May), Lewis explained how quickly one missed council tax payment can lead to a demand for the full annual amount, sometimes worth thousands and bailiffs knocking on your door.

On the same programme, Labour MP Pat McFadden confirmed that the government is consulting on whether people should be given a more reasonable period of time to repay their council tax debts, rather than facing sudden, unaffordable lump-sum demands.

“I would hope that councils approach this with sympathy and understanding. They of course have a duty to try and collect the council tax because they need that to keep the services running. But when somebody gets into difficulty, I would hope that councils approach it with some sympathy because that’s not been happening in some cases,” he said.

McFadden also stressed the government’s desire to see more councils offer 12-month payment plans instead of the 10-month system. Spreading payments across the full year can make monthly bills more manageable and predictable for households.

If you’re behind on council tax, take action now

Council tax is a priority debt, which means there can be serious consequences if you don’t pay. If you don’t deal with it, the situation can quickly get worse and more expensive.

Here’s what to do if you're struggling:

• contact your local council right away to discuss your situation
• look into any discounts or exemptions you may qualify for
• think about setting up a payment plan to manage your debt over time
• seek debt advice if you’re struggling with money

The most important thing is not to bury your head in the sand. Councils won’t just forget about unpaid tax but many are willing to work with you if you reach out.