That is right. Welsh councils have written off tens of millions of pounds due from residents in unpaid council taxes in the past five years alone.
A total of 22 councils throughout the country have thrown out the window payments that were worth £32.6m throughout the past five financial years. Only last year, the total cost for unpaid council taxes that the authorities decided to scrap was £6.5m.
The council tax write off champion is Wrexham. In 2017-18 it wrote off £922,000. This is £285,000 more write offs than in the previous financial year.
Cardiff, the most populated area in Wales, was the runner up in the competition. It wrote off £743,000 in the last financial year. However, it also must be said that this amount is £365,000 less write offs than during the previous financial year.
Due to a wide variety of reasons, the final amount that is written off by the Welsh authorities varies from year to year. However, the average over these past five years has been over £6.5m per year.
For example, in the financial year 2013-14 this amount was corresponded to £6.7m. The write offs felt in the next period 2014-15 to £6m. And in the next year, the total bill for the council taxes that were written off reached £7m throughout Wales. Then, it decreased to £6.4m in the financial year 2016-17. And it fluctuated slightly in the next year 2017-18 to £6.5m.
And what is council tax? How can it be written off?
Council tax must be paid by every person who is a homeowner or a renter of a house.
Moreover, council tax bills are defined as a priority debt. In other words, if you didn’t have enough money to cover all your bills, council tax payment would take precedence and be paid first as an essential debt. Examples of non-essential bills are personal loans and credit cards.
When you first miss a council tax payment, your local council sends you a written reminder giving you one week to pay your debt.
If you don’t make any payment offer before this time is up, then you will receive a final letter demanding payment for the full year amount. Councils usually spread their tax payments over 10 or 12 months to make them more manageable.
Not paying this final notice will result in your council being allowed to take you to court to get the tax payment that they are owed. In this case, the council is even authorised to get their tax money from your benefits.
They could take other actions against you as well, such as collecting the debt via enforcement agents. And apply for a charging order, committal, or even bankruptcy. And, under certain circumstances, authorities may write off debt.
In the fiscal year 2017-18 the Welsh authorities collected a total of 97.4% of all the council tax that was billed. This is an increase of 0.1% over the previous year. And the highest rate ever collected since the council tax was introduced. The total amount that was collected up to March 31st, 2018 was £87m, including £27m of arrears.
A spokeswoman for the Wrexham council has said that the amount written off was in the financial year of 2017-18, but it also contained older debts from previous financial years.
She also added that the council makes its best efforts to collect all tax debts possible, instead of simply writing off debt. The larger amount written off in 2017-18 was the result of reviewing the older debt over 6 years old. That would allow Wrexham council to focus their collection resources on the most recent debt.
Finally, she added that the tax collection rates for the Wrexham council are above the Welsh average.
