Hillingdon Council Cabinet Member and Officer Decisions
Agreement of Council Tax Collection Strategy
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Democratic Services
Location: Phase II
Ext: 0185
DDI: 01895 250185
CMD No: 1169
To: COUNCILLOR MARTIN GODDARD
CABINET MEMBER FOR FINANCE
c.c. All Members of the Corporate Resources &
Infrastructure Select Committee
c.c. Tiffany Boreham – Head of Revenues and
Benefits
c.c. Andy Evans – Corporate Director of Finance
Date: 12 July 2024
Non-Key Decision request Form D
AGREEMENT OF THE COUNCIL TAX COLLECTION STRATEGY
Dear Cabinet Member,
Attached is a report requesting that a decision be made by you as an individual Cabinet
Member. Democratic Services confirm that this is not a key decision, as such, the Local
Authorities (Executive Arrangements) (Meetings and Access to Information) (England)
Regulations 2012 notice period does not apply.
You should take a decision on or after Monday 22 July 2024 in order to meet Constitutional
requirements about publication of decisions that are to be made. You may wish to discuss
the report with the Corporate Director before it is made. Please indicate your decision on the
duplicate memo supplied and return it to me when you have made your decision. I will then
arrange for the formal notice of decision to be published.
Liz Penny
Democratic Services Officer
Title of Report: Agreement of the Council Tax Collection Strategy
Decision made:
Reasons for your decision: (e.g. as stated in report)
Alternatives considered and rejected: (e.g. as stated in report)
Signed ……………………………………………………… Date……………………..
Cabinet Member for Finance
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AGREEMENT OF THE COUNCIL TAX COLLECTION STRATEGY
Cabinet Member(s) Cllr Martin Goddard
Cabinet Portfolio(s) Cabinet Member for Finance
Officer Contact(s) Tiffany Boreham – Head of Revenues and Benefits
Papers with report Council Tax Collection Policy
HEADLINES
Summary
This report recommends a greement of the Council Tax Collection
Strategy, which consists of an updated Council Tax Collection
Policy, a key document detailing our approach to the collection of
Council Tax and the continued use of Enforcement Agents , which
support us to deliver consistently strong collection rates.
Putting our Residents
First
Delivering on the
Council Strategy
2022-2026
This report supports our ambition for residents / the Council of:
An efficient, well-run, digital-enabled council working with partners
to deliver services to improve the lives of all our residents
This report supports our commitments to residents of:
A Digital-Enabled, Modern, Well-Run Council
Financial Cost This policy is expected to cost up to £1 2k per annum. Funding is
available through existing base budgets of £200k within the Council
Tax Recovery Team.
Relevant Select
Committee
Corporate Resources and Infrastructure Select Committee
Relevant Ward(s) N/A
RECOMMENDATIONS
That the Cabinet Member for Finance:
1. A grees the Council Tax Collection Policy which details all methods of collection
and the stage at which each method will be considered; and
2. Authorises the Corporate Director of Finance to approve Service Level
Agreements with the Enforcement Agent companies and solicitors used to recover
revenues debt.
Reasons for recommendations
The current Council Tax Collection Policy has been in place since 2014 and has prov ided a
framework in which the Council has been able to perform strongly in the effective collection and
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recovery of Council Tax income , with in-year collections rates of 97% against London Borough
averages of 96%. From 1 st June 2024, changes to the Revenues & Benefits service operating
model have gone live, aligned to the transition from the previous outsourced delivery partner,
providing an opportunity to refresh this policy and ensure it fully reflects a changing external
environment and the opportunities afforded by emerging technologies.
Within both the existing and recommended Council Tax Collection Policies, the need to
proactively pursue recovery of sums owed is recognised and the use of Enforcement Agents and
solicitors supports these aspects of collection activities. To ensure that any Enforcement Agents
working on behalf of the Council are fully aligned to policy requirements, it is recommended that
refreshed Service Level Agreements are entered into at this stage.
Alternative options considered / risk management
While there is scope to maintain the existing Council Tax Collection Policy, this is not
recommended as the proposed update ensures that activities are aligned to current best practice
and reflects within a single document new responsibilities such as those contained within the
“Breathing Space” framework. In addition, the refresh updates terminology where appropriate,
such as reflecting the change from Bailiffs to Enforcement Agents.
There is scope for a recovery strategy which does not use E nforcement Agents; however, this
would significantly degrade the Council’s ability to recover sums properly due under Council Tax
and therefore result in a reduction in funds available to support delivery of services to residents.
Select Committee comments
None at this stage.
SUPPORTING INFORMATION
Background information
The Council Tax Recovery function has been split between our outsourced provider Liberata and
an in-house team since 2017. This split makes it difficult to show accountability / responsibility of
the current arrears position.
The Council’s current contract with Liberata in the Revenues & Benefits Service expired on 31
st
May 2024. This has provided an opportunity to review the effectiveness of the split recovery
function.
It has been agreed that, in line with the Liberata contract ending, the Council Tax Recovery Team
is brought back in house, with the priority being collection. Specifically, the team will focus on
recovery and the new team is being recruited to and should be fully operational by July 2024 as
this work is now back with Hillingdon.
The Recovery Team has a new structure , and this change is designed to address the recent
increase in debt requiring recovery. Due to the pandemic and the recent Cost of Living crisis
recovering the debt and engaging with residents has become more complex. The Council Tax
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debt stands at £33 million. P re-Covid, this figure (March 2020) was static at £17 million. During
Covid, the Council Tax debt increased by £16 million, the additional capacity within the team will
be tasked with tackling this increased debt balance over a three-year period.
New Council Tax Collection Policy
To be able to recover the maximum Council Tax debt , the Council will need to use all available
collection methods. During the pandemic the Council followed Central Government advice to put
recovery action on hold. As a result, most local authorities, with Hillingdon being no exception,
have a large amount of debt to tackle and in that context, it is the right time to review the Council’s
recovery practices.
In most cases effective collection of council tax debt can be achieved using the following methods
– attachment to benefits, attachment to earnings, payment arrangements (which are reviewed
periodically) – but there are some persistent debts where these methods do not work.
The new policy lists all the collection methods that could be used, including the more specialist
methods of recovery such as charging orders, bankruptcy and committals. These methods would
only be considered when all other recovery methods had been exhausted and where the financial
benefit outweighs the time and costs involved.
New Service Level Agreements with the Enforcement Agent Companies
The new Council Tax Collection Policy confirms that the Council will continue to use the
enforcement agents for recovery . D uring 2023/24, £2,807,526.91 was recovered using this
method.
Enforcement Agent Recovery totals over last 3 years:
Enforcement Agent
Company 2021/2022 2022/2023 2023/2024
Bristow and Sutor £175,794.55 £911,771.67 £1,424,627.88
CDER £175,311.09 £865,459.13 £1,284,935.47
Stanford and Green £76,475.24 £89,674.12 £97,963.56
The 2023/24 collection figures are higher than usual. This is due to recovery being restarted after
Covid-19 and higher volumes of cases being sent to the enforcement agents for collection.
Stanford & Green’s figures are lower as they collect the cases returned by CDER & Bristow &
Sutor. As these cases are recycled, it can mean it is slightly more difficult to get payment.
The Debt Recovery Enforcement Agent Service Level Agreements have expired, so this report is
requesting to renew the Service Level Agreements with the 3 enforcement agents for a 2 -year
period.
The following enforcement agent companies are used within Revenues (Council Tax and National
Non-Domestic Rates), H ousing Benefit Overpayments and Sundry Debtors : CDER Group,
Bristow & Sutor, and Stanford & Green. There are no costs to the Council regarding the Council
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Tax and National Non-Domestic Rates work as these costs are passed onto the customer based
on the relevant legislation. The costs to Hillingdon are linked to Housing Benefit Overpayments
and Sundry Debts.
The enforcement agents are given cases which have exhausted standard recovery processes .
The enforcement agents have sophisticated technology allowing them to analyse the data,
providing detailed information on our customer base and the contact outcomes. These companies
are compliant with enforcement legislation and vulnerability is considered as part of the
documented agreements. They are a fundamental part of Hillingdon’s collection action.
Transactional Finance & Revenues are projected to spend less than £10K per annum on the 3
suppliers. Whilst the cost to Hillingdon is relatively low, our 3 suppliers could benefit from between
£20k - £250k per annum from fees remitted, making the 2-year contract value up to £500k benefit
to each Enforcement Agent.
Given that tackling debt is a priority for our Local Authority , it is vital that enforcement is utilised
(where suitable) as a method of collection and Hillingdon should continue to benefit from the
advanced technology the enforcement agents operate with.
Financial Implications
The new policy is expected to cost a maximum of £1 2k per annum and will be contained within
the existing revenue budgets of £200k. Note that E nforcement Agents will recover most costs
from liable charge payers alongside sums due to the Council in line with standard practice.
RESIDENT BENEFIT & CONSULTATION
The benefit or impact upon Hillingdon residents, service users and communities
Efficient revenues collection is essential for the daily running of the Council as approximately 70%
of the Council’s income is generated through this (Council Tax and Business Rates).
Having a clear collection policy which details all collection methods available supports the team
to consistently achieve a Council Tax collection rate of 97% , meaning that essential Council
services are better protected.
We have a local Council Tax Reduction scheme, which is a banding scheme that supports
financially vulnerable residents.
Consultation carried out or required
None.
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CORPORATE CONSIDERATIONS
Corporate Finance
Corporate Finance have reviewed this report and concur with the Financial Implications set out
above, noting the recommendation to agree the Council Tax Policy and approve for delegated
authority to be granted to the Corporate Director of Finance to agree an SLA Enforcement Agent
companies and solicitors used to recover revenues debt. The cost of the enforcement action is
forecast to be up to £12k per annum.
The Council’s budget strategy is predicated on the recovery of Council Tax generating an
additional £800k of one-off funding in 2024/25, with a further £2,800k over 2025/26 and 2026/27,
this policy and continued use of Enforcement Agents will assist in securing this benefit for the
Council.
Legal
Legal Services confirm that the Council is responsible for levying and collecting council tax in the
Hillingdon area pursuant to section 97 of the Local Government Finance Act 1992.
The Council, in its Council Tax Collection Policy and wider collection strategy, must not
contravene any of the rules imposed by laws relating to council tax collection, enforcement agents
and enforcement methods, such as:
Part 1 of, and Schedules to, the Local Government Finance Act 1992, concerning core
council tax principles
Council Tax (Administration and Enforcement) Regulations 1992 , concerning
administration and enforcement of council tax
Council Tax (Demand Notices) (England) Regulations 2011 , concerning the content of
demand notices for council tax
Magistrates’ Court Rules 1981 , concerning magistrates’ court processes, including
summons
Part 9 of the Insolvency Act 1986, concerning bankruptcy proceedings
Part 3 of, and Schedule 12 to, the Tribunals, Courts and Enforcement Act 2007, concerning
enforcement by taking control of goods
There is no such contravention in the wording of the recommended Council Tax Collection Policy.
In any event, the Policy itself states that, if is not compliant with a legal requirement, then the legal
requirement has ascendancy. T hus, there are no legal implications to the Council following the
recommendations set out in this report, although any contract that the Council enters into
complies with its Procurement & Contract Standing Orders.
Following implementation of the recommendations, the Council, and the enforcement agents it
instructs, must ensure that they, in practice, continue to comply with the laws relating to council
tax collection and enforcement. In particular, all enforcement agents used must be certified in
accordance with section 64 of the Tribunals, Courts and Enforcement Act 2007 and there are
further procedures under Schedule 12 to that Act that must be complied with when seizing goods.
Service level agreements between the Council and each enforcement agent company it uses are
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legally prudent as they can mandate proper conduct of enforcement agents. This is recognised
within this report, which recommends delegation of authority to approve such service level
agreements to the Corporate Director of Finance. Furthermore, the Council Tax Collection Policy
itself indicates that the Council instructs solicitors to take conduct of certain enforcement options,
which will assist with ensuring compliance with the legal framework.
The Council must also ensure that it complies with its p ublic sector equality duty on an ongoing
basis under section 149 of the Equality Act 2010 in its collection and enforcement strategy by
having due regard to the need to ( a) eliminate discrimination, harassment, victimisation and any
other conduct that is prohibited by or under the Equality Act 2010, (b) advance equality of
opportunity between persons who share a relevant protected characteristic and persons who do
not share it, and (c) foster good relations between persons who share a relevant protected
characteristic and persons who do not share it. An equalities impact assessment may be carried
out for this purpose. The Council Tax Collection Policy itself includes provisions that give scope
for discernment based on vulnerabilities and to support those who may be under financial
pressure. This report also states that the documented agreements with enforcement agent
companies require them to consider the resident’s vulnerability in their enforcement approach. In
addition, the report states that the Council has a local Council Tax Reduction Scheme pursuant
to section 13A of the Local Government Finance Act 1992 in order to support financially
vulnerable residents.
BACKGROUND PAPERS
NIL.
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London Borough of Hillingdon
Council Tax Collection Policy
This policy is intended to comply with the legal requirements of the Local Government Finance
Act 1992, The Council Tax (Administration and Enforcement) Regulations 1992; and other
relevant law and case law. For clarity if this policy is not compliant with a legal requirement, then
the legal requirement has ascendancy.
Contents
1. Introduction
2. Collection Flow Chart
3. Collection Flow Chart – accompanying notes
4. Enforcement Agents
5. Tracing
6. Debts to be written off
7. Maximising Benefit take up, Exemptions, Discounts and Discretionary Reduction
8. Maximising Direct Debit take up.
9. Complaints
10. Changes in Economic Climate
11. Breathing Space – Debt Respite Scheme
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1. Introduction
This policy identifies the legalities of the collection of council tax as set out by the Local
Government Finance Act 1992. It details the responsibilities of how it will be collected and how
support can be given to those suffering financial hardship of vulnerability.
2. Council Tax Collection flowchart
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3. Accompanying Notes to Flowchart
Note 1- Annual Billing
Demand notices are issued by 11
th March in each financial year to allow for the first instalment to
be paid on 1st April and to ensure the appropriate notice is given under the Direct Debit scheme.
Note 2 – Instalment Payment
Instalment payments are due on 1
st each month for those paying by all methods other than Direct
Debit.
The Council has the facility to operate Direct Debit for 4 dates within the month: 1
st, 10th, 18th and
25th designed to accommodate most pay dates for customer convenience.
If required instalments can be paid over 12 months via all available payment methods this must
be requested in writing.
Note 3 – Reminder Notice
Reminders can be issued immediately after an instalment is not paid – in practice they are issued
in accordance with the recovery timetable drawn up in February/March each year.
The regulations outlining the requirements for the reminder notice stipulate the following:
1) If a demand has been served by an Authority and instalments due under that notice, in
accordance with the instalment scheme, are not complied with, then a first reminder notice shall
be served.
2) The reminder must state:
a) The instalments unpaid at the time of the notice, including any instalments, which become
due within seven days of the notice;
b) That this amount is due to be paid within seven days
c) That after a further seven days (i.e. a total of fourteen from the issue date) the right to pay
by instalments will be lost
d) That if a second reminder is issued within the year, (the first issued having been complied
with) any further failure to pay any instalment on or before the date it is due, shall result in
the right to pay by instalments being lost.
e) No reminder notice is required where all the instalments have fallen due.
3) These reminder provisions and the recovery provisions following are provided for the recovery
of the standard instalment scheme
Good practice dictates that the reminder should be issued between seven and 21 days from the
date of the instalment. The Hillingdon recovery timetable takes this into account.
At Hillingdon where a second reminder is issued the following phrase information is added
“This is the Second Reminder Notice the Council has issued to you this year.
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Accordingly, the Council is obliged by law to inform you that NO FURTHER reminder
notices will be issued this year.
This means that if any subsequent payment is not made on or by the due date, the
remaining balance of this year's council tax will become payable in full.
Failure to pay will result in legal proceedings and additional costs payable by you. “
Note 4 – Final Notice
These are issued in accordance with the recovery timetable. Provisions relating to the service of
a final notice are as follows
1. No final is required if a reminder or a second reminder is not complied with within the
statutory time limits.
2. A final is required for recovery for accounts that do not qualify for instalments (e.g. ended
accounts, accounts issued after 31 December).
3. A final is required where the amount due has changed between the outstanding reminder
or second reminder (as the case may be) and after the issue of the relevant adjustment
notice.
4. A final notice need only be served where:
a. There was NO right to instalments, or
b. Two reminder notices have previously been issued and paid and this is
the THIRD occasion in the relevant year that an instalment has not been
paid on time, or
c. All instalments have fallen due
Note 5 – Summons Pre-List
This is prepared following the issue of the reminder notices and /or Final Notice where the sum
due under the notice remains unpaid. The purpose of this list is to allow the manual human
scrutiny of potential summons cases (notes pages etc) to sift any cases where a summons should
not be issued. The list should be scrutinised as soon as possible to ensure information is up to
date and to avoid the issue of unnecessary summonses. The prelist checking will also consist of
the use of technology to issue automated text messages and emails to prompt payment and avoid
the issue of a summons.
Note 6 – Summons Issue
Summonses are issued in accordance with the recovery timetable agreed in Feb/March of the
previous financial year
The Summons is issued, subject to the following rules:
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1) A Summons may be issued to two or more taxpayers jointly liable for a
debt.The practice at Hillingdon is to serve each liable person with an
individual summons.
2) The summons will be reviewed and then electronically agreed via email by
the Clerk to the Court, agreeing the complaint for that particular hearing. A
summons at Hillingdon will be printed and posted after prior emailed
agreement from the Clerk to the Court confirming the Complaint.
3) The summons will not bear a signature as it is no longer a legal necessity.
4) The Summons must state:
(a) The reason for its issue – unpaid Council Tax
(b) Make reference to the address concerned
(c) The Council Tax outstanding together with any amount in respect of costs
reasonably incurred
(d) The date and time of the hearing.
The Summons may be served as follows:
1) Delivering it to the person
2) Leaving it at the usual or last known abode of the
liable person, or in the case of a limited company,
at its registered office
3) Leaving it at or sending it by post to an address
given by the liable person as one where service
will be accepted.
Good practice dictates that at least 21 days should be allowed from the issue of a reminder to
the issue of a summons.
The summons is served with costs currently £125.00.
If the amount due, plus costs is received prior to the date of the hearing the Council will not apply
for a Liability Order.
If the customer is not able to pay in full prior to the hearing the Council will continue to proceed
with the application for a Liability Order.
At this stage the customer may negotiate a payment arrangement. Any such arrangement will
include costs. The normal arrangement will be over three months, or to the end of the tax year,
whichever is the soonest. However, in some cases it may be possible to extend the arrangement
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further than three months to the end of the financial year, if a customer agrees to payment by
Direct Debit. (See also Note 11)
A summons and associated costs will only be withdrawn if it can be shown that the Council had
erroneously issued the summons.
Application for a Liability Order begins with the complaint made by the authority to a Clerk of the
Court requesting that a summons be issued to the liable person to show why the sum outstanding
has not been paid.
Note 7 Liability Order Application
The Court Hearing takes place in accordance with the dates agreed with the Uxbridge Magistrates
Court which are detailed on the recovery timetable.
An interval of at least 14 days must be allowed between the issue of the summons to the defaulter
and the hearing, as a liability order cannot be made unless 14 days have elapsed between issue
and hearing.
The usual practice at Hillingdon is to serve the summons 21 days before the Hearing.
At the Hearing an authorised officer of the Council will make an application to the Court for Liability
Orders for a number of cases on the bulk list. The Magistrates will hear the defence of persons
wishing to prevent the issue of a Liability Order.
Note 8 – Information Request (14-day letter)
Notices requiring certain information from the debtor are issued within 7 days of the hearing to all
cases where no arrangements to clear the debt have been made since the issue of the summons.
Whilst there is no legal requirement to send this, any information received will help in deciding the
next course of action to take.
By virtue of the liability order the Authority may request the following information from the liable
person, which must be supplied within 14 days, provided the information is in their possession or
control:
1) The name and address of their employer
2) The amount earned
3) Amounts deducted for Income Tax, N I or Superannuation
4) Any payroll or works reference
5) Any other attachment orders in place
6) Other sources of income
7) Whether any person is jointly liable for the debt
The Magistrate’s Court is able to impose fines for either:
1) The supply of false information (level 3 fine)
2) The failure to supply information (level 2 fine)
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The Authority would make application for such a fine by laying a complaint to a Justice of the
Peace for the issue of a summons.
The Authority may ask for other information other than that listed above but there is no compulsion
on the debtor to provide it.
Note 9 – Options for further Recovery Action
Where information is received from the debtor about their financial circumstances officers can
make the decision as to which option should be adopted next. If information is already held such
as by the team administering Housing Benefit and Council Tax Reduction, then that data may be
used. Data sharing with HMRC and DWP has been trialled and is being rolled out nationwide,
this data sharing may be used to establish an appropriate method of enforcement. In Hillingdon
that decision should be taken in accordance with the following hierarchy.
Option 1 Attachment of Earnings Order - Where a debtor is employed then an Attachment
of Earnings should be sought.
The Authority is able to serve Attachment to Earnings Orders for unpaid Council Tax.
These orders act under the following provisions:
1) An order, once served will remain in force until the balance for which it is served is
clear, or if the Authority withdraws it.
2) The content of the order is prescribed, as follows:
(a) It must be addressed to the debtor’s employer
(b) It must specify the sum outstanding
(c) It must include details of the deduction tables and rules as prescribed
in the regulations
(d) It must be signed by the “proper Officer” of the
Authority.
3) The amount is deducted on the basis of the tables contained in the regulations
which gives percentages to be applied to “net earnings” after Income Tax, NI,
Superannuation, deductions for advances of salary and other Council Tax
attachment to earnings deductions are considered.
4) Attachable pay includes wages/salary, overtime, holiday pay, other fees,
bonus, commission, or SSP.
5) Complicated rules allow multiple attachments and prioritise some order over
others. For details of these consult the Recovery Manager
6) The service of an attachment order gives the following duties to the debtor
and their employer.
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7) The Employer must notify:
(a) The Authority of the employment of a person who they know is subject
to attachment
(b) Of receipt within 14 days of the order
(c) The Authority within 14 days of the employee leaving
(d) The debtor of the deductions made
8) The Debtor must notify:
(a) The Authority within 14 days of a change in employment
(b) The Authority of a change in their earnings or
deductions.
9) Offences are committed and fines may be imposed for non-compliance with
the regulations. Both the employer and the employee may be subject to the
following fines:
(a) The employer may be fined for: -
(1) Failure to comply with an order (Level 3)
(2) Supply of false information (Level 3)
(3) Failure to give all notifications required (Level 3)
(b) The employee may be fined for: -
(1) Supply of false information (Level 3)
(2) Failure to supply information (Level 2)
10) When the debtor is employed by the Crown, the Chief Officer of the
department in which the debtor is employed shall be treated as the employer.
Although the pay of those in the armed services is specifically exempted from
the definition of earnings, where the debtor is employed by the armed forces,
the army may make deductions under the Army Act 1955 on request by the
Local Authority.
11) A Local Authority may serve Attachment Orders on itself as employer for a
debtor.
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Where a defaulter is in receipt of Universal Credit/Income Support/Job Seekers
Allowance/Employment Support Allowance/Pension Credit then a deduction from their
Benefit should be sought.
The Authority is able to apply to the Department for Work and Pensions (DWP) to make
deductions from the above Benefits for unpaid Council Tax. A Liability Order MUST be
obtained for this purpose and there are no voluntary powers to otherwise agree such
deductions.
The deduction takes place under the following rules:
1) An application is made to the DWP who is currently paying the debtor
benefits whether or not that office is in the Authority area.
2) The DWP must make deductions for only one Council Tax liability at a time,
even where more than one liability exists. The DWP must also consider any
other deductions they are already making and together with their own rules
which cap the total deduction which m ay be made from the claimant, work
out whether any deduction for Council Tax may be made. Deductions for
fuel, water, rent are prioritised above Council Tax and in turn above Court
fines.
3) Deductions can only be made where the DWP claimant’s name appears on
the Liability Order.
Option 3 Attachment of Members Allowances – Where the debtor is a Member of
the Council then attempts should be made to make an attachment of his/her Member’s
Allowance. This should only be undertaken after consultation with the Head of Revenues
and Benefits.
These Attachments operate under the following rule:
1) 40% of an allowance is attachable.
2) The allowances of members of any of the following authorities may be
attached:
- Billing Authority
- County Council
- Certain Police Authorities
- London & Metropolitan Fire & Civil Defence
Authorities
These provisions operate separately from the rules excluding Council Members in arrears
with payment from voting on certain matters.
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Option 4 Enforcement Agent Action – (See note 10 below and chapter 3).
Note 10 - Notice of Enforcement Agent Action (Pre Action letter)
1. Where no information is received from the debtor, or where the other recovery options
outlined above have failed then the liability order should be passed to the Council’s
enforcement agents for action.
2. Before this action can be undertaken the debtor will be given prior notice by the Council of
at least 14 days.
3. This Council sends “pre-enforcement action letters” notifying taxpayers who have broken
arrangements, or not made contact since the Liability order hearing, that the Council is
considering passing the Liability Orders to the Council’s certified enforcement agents.
4. The letter warns that should the matter be passed to the Council’s enforcement agents
there could be considerable extra costs and the enforcement agents can legally take goods
to clear the debt and charge for the sale of such goods.
5. Information regarding the enforcement agent charges is detailed within each letter. The
letter also contains a link to the online form, which is a demand for statutory information,
to be returned within 14 days, to again allow the Council to consider alternatives to
enforcement agent action.
6. Alternatively, the debtor is encouraged to contact the council to make a payment
arrangement.
7. These notices are issued regularly picking up any cases where arrangements have been
made following the issue of a Liability Order, or where the other options for recovery have
not been possible.
Option 5 Insolvency
1. Where none of the above recovery methods are applicable and the Council has
ascertained that the debtor is the owner of the liable property the Council may consider
applying for bankruptcy proceedings. At this stage, if the information on the debtor is
insufficient on which to decide about appropriate action, an equity position report will be
requested from the solicitors.
2. The council will pass the solicitors information relating to the property address, liable party
name and any other property with which the liable party is known to be associated,
including any business addresses and trading names known.
3. The equity report gives an overall view of the debtor’s financial status and anticipated level
of equity in any property, in which they have a financial interest and the liquidity of any
business interest that they may hold.
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4. The equity report is compiled with copies of Land Registry documents, credit reference
reports, and Company House reports, if applicable.
5. Once in receipt of all relevant information a decision is taken regarding the possibility of
recovering the debt using bankruptcy action. The detail of the level of equity available in
any property interests of the debtor is a primary factor in this decisi on. However, social
considerations may also dictate that the Council will consider a charging order more
appropriate.
6. Bankruptcy is a procedure available to the Council in the enforcement of unpaid Council
Tax and NNDR and will be considered where it is deemed more appropriate than other
methods of enforcement.
7. Bankruptcy, as a course of action, should only be used with the prior authority of the Head
of Revenues and Benefits. Background details on each case will be supplied to the Head
of Revenues & Benefits in a written summary. The Head of Revenues & Benefits will use
this information t o determine whether the case is suitable for a Bankruptcy Petition or
request alternative action or further information. The Head of Revenues & Benefits will sign
and authorise the action on the covering pro- forma issued to the acting solicitors. A copy
of which will be kept on file.
8. On receiving an enforcement agent return, consideration is given as to whether there are
employment details and the account can be set up for an attachment of earnings, or
whether the person is on a suitable benefit and can be set up for deductions from th at
benefit.
9. Bankruptcy is usually considered after cases have been returned as unsuccessful by the
enforcement agents, alongside the other available options. Bankruptcy is considered an
effective method of recovering the debt where there is equity in the property.
10. Accounts considered suitable for bankruptcy are selected from cases that have previously
been passed to enforcement agents and have been returned either unable to gain entry,
unable to gain access or returned no goods. Normally cases are targeted where there is
more than one financial year’s debt outstanding, or where there is a debt over £5,000 made
up from debts outstanding on different accounts for one taxpayer.
11. When selecting if the accounts are suitable the following factors must be taken into
consideration:
• The level of potential equity available in relation to the liable property and any
other associated properties where the debtor has a financial interest and
whether this is sufficient to cover the debt outstanding and any potential costs.
• Is the total of debts outstanding more than one financial year’s value, or in the
case of multiple accounts more than £5,000 (Band A in Hillingdon now exceeds
£1,242.58)
Cabinet Member Report Page 19
Part 1 Public
• Have the NEC and Civica systems been checked to see if employment details
can be found, or if the person is on suitable benefit for deductions to be made.
• Is there any documentary evidence on file to suggest that the debtor could be
vulnerable? If so, have attempts been made to substantiate or clarify the debtor’s
position.
• Is there any evidence or local knowledge to suggest that the property is already
up for sale, or may be up for sale soon, in which case a charging order may be
appropriate?
12. A warning letter is sent to potential cases once the liability order(s) have been returned
from the enforcement agents as an unsuccessful case. The warning letter is accompanied
by a bankruptcy guide, outlining the purpose of a statutory demand and the implications,
risks and costs associated with bankruptcy including the possibility of a forced sale of their
home by the Official Receiver /Trustee to pay their creditors
13. The Council will allow at least 14 days from the issue of the letter warning of the possibility
of bankruptcy proceedings before passing cases to the Council’s bankruptcy practitioners.
14. The Council will issue a pro-forma document to the practitioner. The document will include
the date that the instruction is passed to the practitioner, the name of the debtor, the
property address to which the charge relates and the debtor’s current addres s if different,
the property reference number, the council tax account number (s) and the total amount
being pursued.
15. The information will supply a breakdown of each liability, date the liability order was issued
and the period covered together with the amount of council tax and costs still outstanding
per liability order.
16. This is repeated for each separate account held.
17. There is an opportunity to provide further relevant information under comments e.g. any
aliases, copies of land registry details and confirmation of the date of the “bankruptcy
warning letter”
When a case has been issued to the bankruptcy solicitors a note is placed on the council
tax account to ensure that all further contact from the debtor is referred to the solicitors.
18. On receipt of the pro- forma the solicitors will serve their own letter before action giving 7
days. If no payment or contact is made, then a statutory demand is served on the debtor
under Section 268(1)(A) of the Insolvency Act 1986.
19. On service of the statutory demand the solicitors have been given guidelines to make
arrangements (if offered) not exceeding 3 – 4 months.
20. The solicitors may contact the Council to seek authority for any arrangement that falls
outside of these guidelines.
21. If no contact is received from the debtor, the solicitors will contact the Council to seek
authority to issue the bankruptcy petition.
Cabinet Member Report Page 20
Part 1 Public
22. Whilst it is usual to consider bankruptcy proceedings once attempts have been made to
recover the debt using enforcement agent action the Council do not need to have issued
the liability order to the enforcement agents prior to considering the action. The Council
will consider bankruptcy at an earlier stage if circumstances dictate that this would be a
more effective and appropriate method of recovery action, or if a further liability order is
obtained once the Council has commenced proceedings at an early enough stage to
include the sum in any planned proceedings.
Option 6 Charging Order
1. Where the Council holds information to suggest that the circumstances of the debtor would
indicate that payment of the debt is unlikely to be achieved through bankruptcy, or where
the current address of a debtor is either unknown or overseas, preventing service of a
statutory demand, a Charging Order may be more appropriate.
2. The Council may also consider this action more appropriate where the debtor is on a low
income such as in receipt of DWP benefits, resident owner of the liable property and
vulnerable or elderly. (In such cases it is unlikely the Council would proceed to force a sale
once a Charging Order was obtained). Each case will be regularly reviewed for a change
in circumstances which may effect the decision to progress to a forced sale.
3. The Council will only proceed with a Charging Order once the Head of Revenues &
Benefits has approved such action, in writing. Background details on each case will be
supplied to the Head of Revenues & Benefits in a written summary. The Head of Revenues
and Benefits will use this information to determine whether the case is suitable for a
Charging Order, or request alternative action, or further information.
4. The Head of Revenues & Benefits will sign and authorise the action on the covering pro-
forma issued to the acting solicitors. A copy of which will be kept on file.
5. For all cases where the decision has been taken to proceed with a Charging Order, a pro-
forma will be issued to the solicitors dealing with the matter on behalf of the Council.
6. The pro-forma instruction will show;
• The date that the instruction is passed to the practitioner,
• the name of the debtor
Cabinet Member Report Page 21
Part 1 Public
• the property address to which the charge relates and the debtor’s current address,
if different,
• the property reference number
• the council tax account number (s) and the total amount being pursued.
7. The information will supply a breakdown of each liability order, date the order was issued,
and the period covered together with the amount of council tax and costs still outstanding
per liability order.
8. This is repeated for each separate account held.
9. There is an opportunity to provide further relevant information under comments e.g. any
aliases, copies of land registry details and confirmation of the date of the
“bankruptcy/charging warning letter”, detailing periods of liability, dates of the liabilit y
orders obtained by the Council and in each case the council tax outstanding and the costs
incurred.
10. When a case has been issued to the solicitors a note is placed on the council tax account
to ensure that all further contact from the debtor is referred to the solicitors.
11. At any stage in the procedure the department will use local authority records available to
it under the terms of the UKGPDR, and the Data Protection Act 2018 to attempt to gain
relevant information for an assessment to be made and may also contact other agencies
e.g. Social Services.
12. Once a Charging Order has been obtained and where it has been confirmed that a debtor
or his/her partner is aged 60 or over, or if under 60 but with dependent children under 18,
then no further action in relation to a Charging Order will be taken i.e. the Council will not
proceed to enforce an order for sale at that point. Each case will be regularly reviewed for
a change in circumstances which may effect the decision to progress to a forced sale.
13. This procedure will also apply where there is strong evidence of mental illness, mental
incapacity, severe disability, and blindness or terminal illness affecting any permanent
residents at the property. This will safeguard the most vulnerable from the effects of losing
their home but will ensure that the Authority has the ability to recover the debt on behalf of
the taxpayers in the Borough, in the event of a sale, or transfer upon the death of the
taxpayer.
14. This procedure will also apply where there is strong evidence of mental illness, mental
incapacity, severe disability, and blindness or terminal illness affecting any permanent
residents at the property. This will safeguard the most vulnerable from the effects of losing
their home but will ensure that the Authority has the ability to recover the debt on behalf of
Cabinet Member Report Page 22
Part 1 Public
the taxpayers in the Borough, in the event of a sale, or transfer upon the death of the
taxpayer.
15. The Head of Revenues & Benefits may use his/her judgement at any time in the process
to refuse authority for a Charging Order or to withdraw an instruction for an enforced sale
where in his/her opinion the best interests of the authority would be served by this action.
16. Where the solicitors are instructed to apply for a Charging Order they will be given full
authority to deal with the case. If a forced sale is contemplated, they must seek further
written instructions from the authority on whether the forced sale will be approved.
17. The Head of Revenues & Benefits will receive a full updated report on the case and use
this report to determine whether to authorise the forced sale of the property.
18. Written instructions will be issued to the Solicitors on behalf of the Head of Revenues &
Benefits.
19. Where the forced sale is not considered appropriate, the Charging Order will remain on
the property until it is sold. The department may still seek recovery by other methods for
any debt not covered by the Charging Order.
Note 11 – Arrangements
Arrangements can be made at any time of the proceedings. The aim of the arrangement is to
ensure the debt is paid within the financial year. Ideally arrangements need to be made using
Direct Debit as a payment method.
Once a Liability Order has been issued the dates available for Direct Debit are the 5
th and 21st.
Customers will also be encouraged to sign- up to one of the 4 Direct Debit dates available for
normal instalments for the following year.
Where possible all debt should be collected by the end of the year it is due. However, in
exceptional circumstances of hardship/financial difficulty, (demonstrated by the provision of
income and expenditure details) it may be possible to extend this further, up to 6 months into the
next financial year. All arrangements must be confirmed in writing.
Cabinet Member Report Page 23
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Note 12 – Monitoring of Payment Arrangements
Payment arrangements are monitored regularly by the system. Where payments are not made,
as agreed, cases will be moved to the next stage of recovery, with the appropriate notice for the
next stage being sent. e.g. pre-enforcement agent letter
Note 13 – Commence Committal Proceedings
Where the debt remains unpaid and enforcement agent action has proved unsuccessful the
Council will need to consider the available options. Where a Charging Order, or Bankruptcy are
not considered viable options (i.e. where the debtor does not own the property in question or any
other property) the Council will consider an application for a Warrant of Commitment.
[NB before this course of action can be undertaken it is essential that enforcement should
have been attempted and a certificate confirming this provided to the Council by the
enforcement agents].
There is no legal requirement for the Council to attempt other recovery options, good practice
dictates that other recovery options be tried. Previous experience at Uxbridge Magistrates
Court has been that Magistrates like to satisfy themselves that the Council has explored
other recovery options prior to proceeding to a Means Enquiry.
Proceedings in Hillingdon are always commenced with the issue of a committal summons.
Note 14 – Committal Hearing
This is effectively an inquiry by the Magistrates into a debtor’s means and conduct, with a view to
whether the failure to make payment is due to wilful refusal or culpable neglect. Such an inquiry
can only be conducted in the presence of the defaulter. If the defaulter fails to appear the Council
will apply for a warrant for the arrest of the debtor. This would normally be a warr
View Decision / Minutes Text
Executive Decision Notice – 8 August 2024
This notice is a public document also available to view on the Council's website www.hillingdon.gov.uk
OFFICIAL EXECUTIVE DECISION NOTICE
PUBLISHED BY DEMOCRATIC SERVICES
Notice is hereby given that the following decision(s) have been made today by
Cabinet Members at the London Borough of Hillingdon:
Title of decision AGREEMENT OF THE COUNCIL TAX COLLECTION
STRATEGY
Reference No. 1169
Date of decision Thursday 8 August 2024
Call-in expiry date Thursday 15 August 2024
Relevant Select
Committee
Corporate Resources and Infrastructure Select Committee
Relevant Wards N/A
Decision made
Cabinet Members
making the decision
Councillor Martin Goddard – Cabinet Member for Finance
Decision Approved
That the Cabinet Member for Finance:
1. A greed the Council Tax Collection Policy which
details all methods of collection and the stage at
which each method will be considered; and
2. Authorised the Corporate Director of Finance to
approve Service Level Agreements with the
Enforcement Agent companies and solicitors used to
recover revenues debt.
Reason for decision The current Council Tax Collection Policy has been in place
since 2014 and has provided a framework in which the Council
has been able to perform strongly in the effective collection and
recovery of Council Tax income, with in-year collections rates of
97% against London Borough averages of 96%. From 1
st June
2024, changes to the Revenues & Benefits service operating
model have gone live, aligned to the transition from the previous
outsourced delivery partner, providing an opportunity to refresh
this policy and ensure it fully reflects a changing external
environment and the opportunities affor ded by emerging
technologies.
Within both the existing and recommended Council Tax
Collection Policies, the need to proactively pursue recovery of
sums owed i s recognised and the use of Enforcement Agents
Executive Decision Notice – 8 August 2024
This notice is a public document also available to view on the Council's website www.hillingdon.gov.uk
and solicitors supports these aspects of collection activities. To
ensure that any Enforcement Agents working on behalf of the
Council are fully aligned to policy requirements, it is
recommended that refreshed Service Level Agreements are
entered into at this stage.
Alternative options
considered and
rejected
While there is scope to maintai n the existing Council Tax
Collection Policy , this is not recommended as th e proposed
update ensures that activities are aligned to current best
practice. In addition, the refresh updates terminology where
appropriate, such as reflecting the change from Bailiffs to
Enforcement Agents.
A recovery strategy which does not use E nforcement Agents;
would significantly degrade the Council’s ability to recover sums
properly due under Council Tax and therefore
result in a
reduction in funds available to support delivery of services to
residents.
Classification Part I - Public
Link to associated
report
Here
Relevant Officer
contact & Directorate
Tiffany Boreham – Head of Revenues and Benefits
Any interest declared
by the Cabinet
Member(s) /
dispensation granted
N/A
Implementation of decision & scrutiny call-in
[Internal Use only]
When can this
decision be
implemented by
officers?
Officers can implement Cabinet Member decision in this notice only
from the expiry of the scrutiny call-in period which is:
5pm on Thursday 15 August 2024
However, this is subject to the decision not being called in by
Councillors on the relevant Select Committee. Upon receipt of a
valid call-in request, Democratic Services will immediately advise
the relevant officer(s) and the decision must then be put on hold.
Councillor scrutiny
call-in of this
decision
Councillors on the relevant Select Committee shown in this notice
may request to call-in this decision. The request must be before the
expiry of the scrutiny call-in period above.
Councillors should use the Scrutiny Call-in App (link below) on their
devices to initiate any call-in request. Further advice can be sought
from Democratic Services if required:
Scrutiny Call-In - Power Apps (secure)
Executive Decision Notice – 8 August 2024
This notice is a public document also available to view on the Council's website www.hillingdon.gov.uk
Further information These decisions, where applicable, have been taken under The
Local Authorities (Executive Arrangements) (Meetings and Access
to Information) (England) Regulations 2012.
This is the formal notice by the Council of the above executive
decision, including links to the reports where applicable.
If you would like more information on this decision, please contact
Democratic Services on 01895 250636 or email:
democratic@hillingdon.gov.uk.
Circulation of this decision notice is to a variety of people including
Members of the Council, Corporate Directors, Officers, Group
Secretariats and the Public. Copies are also placed on the
Council’s website.
Democratic Services
London Borough of Hillingdon
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