Torridge District Council - A Fair Collection and Debt Recovery Policy
 
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Torridge District Council - A Fair Collection and Debt Recovery Policy

This policy covers the collection of Council Tax, Business Rates, Debtors and Housing Benefit Overpayments.

Our Duty to Collect and Recover...Torridge District Council

  • Has a legal duty to ensure cost effective billing, collection and recovery of all sums due to the Council;
  • Considers that people have a responsibility to pay.

Torridge District Council believes in pursuing recovery of all debt types. Torridge will strive to ensure that the manner in which this is undertaken is fair and consistent to everyone. The Council is also keen to ensure all activities in relation to recovery of debt are transparent and as part of this commitment has drafted this policy with the involvement of the Citizens Advice Bureau (CAB) Bideford.

Torridge District Council recognises that people do not pay their debts for a variety of reasons:

  • some people genuinely struggle to meet their payments and need advice and assistance in budget management
  • some people deliberately choose to set out to delay, or not pay their debts
  • some people are not receiving the benefits they are entitled to
  • some people go through personal difficulties that result in short-term problems in paying their debts

Our Mission...

  • to bill the right person/business at the right property at the right time
  • take correct action to maximise recovery of Debt
  • to maximise Benefit take up

The Strategic Plan - Torridge - A great place to live, work and visit!

This policy meets the requirements of the Council's strategic goals

  • Aim to become an excellent Authority
  • Improve quality of lives

Torridge District Council's commitment to the customer includes the following:

  • an opportunity for customers to have one to one contact with staff, either by phone or personal visit
  • a robust recovery programme for debtors who appear to deliberately delay, or refuse to pay debt owing
  • inform people of their entitlement to exemptions, discounts and reliefs
  • a willingness to work with customers when genuine difficulties are being experienced.
  • arrangements made to spread repayment in genuine circumstances.
  • a willingness to exhaust the benefit system to establish entitlement to council tax benefit and housing benefit.
  • a commitment to sign post customers to other agencies where considered appropriate, for example CAB, Department for Works and Pensions.

When People get into arrears, we will...

  • encourage customers to contact the Council immediately it becomes evident that there could be problems in paying their bills.
  • consider payment arrangements that reflect the ability to pay as well as the level of debt owed.
  • consider whether the customer needs to complete an income and expenditure form, setting out their reasonable residual income. The Council may request documentary evidence to support the customer's statement
  • on occasions, depending on the point of contact from customer, secure the debt prior to engaging with any arrangement to repay the debt
  • acknowledge and respect a person's obligations to their children and the need to maintain a reasonable standard of living
  • work with recognised advice agencies whenever possible
  • maximise benefit take-up when appropriate and advise customers accordingly, working with the Council's benefits team.
Billing Processes

The customer can expect...

An initial bill that sets out clearly information stipulating:

  • What the bill is for
  • The amount due
  • How to contact the council
  • How to make payment

Information and advice to Council tax Payers...

The annual Council Tax Bill will include details on;

  • Valuation Bands
  • Discounts
  • Reductions for people with disabilities
  • Exempt Dwellings
  • Council Tax Benefit
  • Appeals
  • How the Council Tax is spent
  • Contact details

Information and advice to Business Rate Payers...

The annual Business Rate Bill will include details on;

  • Rateable Values
  • Reliefs and exemptions
  • Appeals
  • How the Council Tax is spent
  • Contact details

Information and advice with Sundry Debtor Accounts Business Rate Payers...

The following information will be included with Sundry Debtor Invoices;

  • Reason for invoice
  • Method of payment
  • Contact details

Information and advice with Housing and Council Tax Benefit Overpayments...

An overpayment occurs when a payment of Housing/Council Tax Benefit has been made and there was no entitlement to that benefit. Customers will be advised of;

  • Reason for invoice
  • Method of payment
  • Contact details

Payment of a Debt

At Torridge we have tried to make paying your bills as easy as possible. Tor ridge offers a variety of convenient methods, which include:

  • Payment by Direct Debit
  • Payment by cash – At either one of the three Council offices (Bideford, Holsworthy or Torrington)
  • Payment by cash at the Post Office
  • Payment by cheque at any of the above places, or through the post.
  • Payment by Debit/Credit Card
  • Over the phone to an officer during office hours
  • By using the special automated telephone line – Number 0300 7900215
  • Over the Internet (www.torridge.gov.uk)
  • Payment from ongoing Housing Benefit (Housing Benefit Overpayment - Will be taken out at source)

Whichever method the customer chooses, payment must reach the Council by the due date.

The council actively encourages people to make immediate contact if they are having difficulty paying their bills.

When Customers do not pay

Torridge District Council believes in pursuing recovery of all debt types, but will also seek to ensure that the manner in which this is undertaken is fair and consistent to everyone.If there is a genuine problem facing the customer Torridge will engage and establish an appropriate way forward. However, customers who deliberately delay, fail to make payments, or do not keep to agreed arrangements, will be subject to a robust recovery procedure as set out in appendix 1 – 4.

Late Payments - Businesses

Under the Late Payment of Commercial Debts (Interest) Act 1998, the Council is able to charge interest on late payments when both parties are acting as businesses. Interest is charged 30 days after the date of the invoice at the rate of 8%. Torridge District Council reserves the right to charge interest in accordance with the above.

The Business Tenants Arrears Policy (Approved) confirms a charge of 4% plus the bank base rate.

Making an arrangement to pay

When a customer is genuinely struggling to meet their commitment, the Council will consider making an arrangement so as to enable the debt to be re-paid in full, within agreed time limits.As part of this process the Council may request the customer to complete an income and expenditure form to establish their financial position.

The council will consider this information and in addition, will consider:

  • The Department for Works and Pensions recommended amounts.
  • Statutory deduction sums in relation to attachment of earnings.
  • What would be a reasonable sum, taking account of residual income.

Customer Welfare

Torridge District Council is obliged to pursue recovery of all debt type and endeavours to apply a fair and consistent approach to all customers, regardless of age, gender, personal circumstance etc.

There are occasions when a customer may have particular difficulty in responding to debt matters.If such cases are identified, the Council will endeavour to do all it can to assist the customer in establishing a way forward.This may be to invite the customer for a personal interview, or visit them in their home.

Visits

If the Council considers a visit to the customer in their home may be beneficial, the Council will...

  • Make contact with the customer to establish if a visit is agreeable.
  • Give the customer adequate notice of the date and time of visit.
  • Explain to the customer the purpose of the visit.
  • Advise the customer that they can have someone with them during the visit.
  • The Council visiting officer will carry identification evidence and will display identification at first contact.

Signposting

Torridge has a "Sign posting" contact list available that includes various organizations who could help customers with financial issues.

Council Tax Recovery Processes

1.Bill issued – Payable over 10 months, April – January

Customer fails to make payment

2.1st Reminder – If customer pays within 7 days of 1st reminder normal payments can continue and no change to arrangements.

Customer pays after 1st reminder but misses or pays another instalment late

3.2nd Reminder – This is the same as the 1st reminder but notifies the customer that if another payment is missed the right to pay by instalments is lost.

If customer misses one more payment after the second reminder

4.A Final Notice - is issued requesting the remaining balance be paid within 7 days.

Non-payment after 2nd reminder or final notice

5.Summons issued – The Council will summons the customer to Court and £45.00 costs are charged to the customer. If payment is made in full by the court date, no further costs are added.

If the debt is not paid in full by the court date

6.Liability Order – The Council will go to court and request a Liability Order. The customer incurs further costs of £20.00.

Once a Liability Order has been granted

7.14-day letter- The Council will issue a letter requesting employment/benefit details. If the customer returns this information an attachment of earnings/benefit is set up.

If the customer does not respond to the 14 day letter

8. Enforcement Agents – The council will forward the account to the Enforcement Agents.

The Enforcement Agent will attempt to obtain monies due. Additional costs will be levied to the customer by the Enforcement Agent.

If the Enforcement Agent fails to obtain monies due the case is returned to the Council

9.Committal – The Council will forward the case to Court for committal proceedings. The Court will decide on appropriate actions. This will be either, 1. Remit the debt, (cancel what is owing in full, or in part) 2. Set up an arrangement to pay the debt, or 3 Issue a prison sentence not exceeding 3 months.

Business Rates Recovery Processes

1.Bill issued – Payable over 10 months, April – January

Customer fails to make payment

2.1st Reminder – If customer pays within 7 days of 1st reminder normal payments can continue and no change to arrangements.

Customer pays after 1st reminder but misses or pays another instalment late

3.A Final Notice - is issued requesting the remaining balance be paid within 7 days.

Non-payment after final notice

4.Summons issued – The Council will summons the customer to Court and £45.00 costs are charged to the customer. If payment is made in full by the court date, no further costs are added.

If the debt is not paid in full by the court date

5.Liability Order – The Council will go to Court and request a Liability Order. The customer incurs further costs of £20.00.

Once a Liability Order has been granted

6.Enforcement Agents – The Council will forward the account to our Enforcement Agents.

The Enforcement Agent will attempt to obtain monies due. Additional costs will become payable to the Enforcement Agent by the customer.

If the Enforcement Agent fails to obtain monies due the case is returned to the council

8.Committal – The council will forward the case to Court for committal proceedings. The Court will decide on appropriate actions. This will be either, 1. Remit the debt (cancel what is owing in full, or in part) 2. Set up an arrangement to pay the debt, or 3. Issue a prison sentence not exceeding three months

Sundry Debtor Recovery Processes

1.Invoice issued by various service departments – Payable by the due date

Customer fails to make payment by the due date.

2.Reminder letter issued – payment requested within 7 days

Payment Still not received.

3.Final Notice issued – payment requested within 7 days, notice stipulates that failure to pay will result in either the debt being passed to a collector or the Court.

Unpaid over 28 days from due date

4.Further Courses of Action

·If debt relates to a managed workspace – Corporate Property Team are informed and the necessary action is taken – personal visits, letters and then Enforcement Agents.

·For other debts over £500.00 - A pre-litigation letter is issued and then the debt is passed to the Council's legal section for action – this will be actioned through the County Court.

·For other debts less than £500.00 – the debt is passed to the Council's collector

Housing Benefit Overpayment Recovery Processes

1.Invoices are issued the day after an overpayment is created.

Customer fails to make payment by due date

2.1st reminder- Issued 28 days after the invoice date

Customer fails to make payment by due date

3.2nd reminder - Issued 14 days after the 1st reminder

Customer fails to make payment by due date

4.Final letter - Issued 14 days after the 2nd reminder

Customer fails to make payment by due date

5.Referral Action – One or more of the following

  • Department for Work and Pensions for deductions from other state benefits
  • Refer to other Local Authorities for deductions from Housing Benefit
  • Refer to Collector Agency for debt collection

The debt remains unpaid

6.Court Action – County Court Judgement obtained against Debt

  • Various recovery options available once a CCJ has been obtained, including Attachment of earnings, apply to the court for a warrant of execution.

Terminology

What does it mean?

Final Notice – A document issued when an account is in arrears and the right to pay by instalments has been lost.

Summons – A document issued summoning the ratepayer to the Magistrates Court when there has been no satisfactory response to other reminder notices. At Court, the council will apply for a Liability Order.

Liability Order – The Magistrates will grant a liability Order if they are satisfied that debt is outstanding.The Order gives the council the power to take further action if the account remains unpaid.The main options are;

  • Attachment of benefits/earnings
  • Referral to Enforcement Agent
  • Bankruptcy proceedings

Charging Order – This may be voluntary or via the court and is where a charge/debt is put on the debtors property. If the property is sold then the charge is repaid out of the money received. A charge can remain on a property for many years.

Taking Control of Goods – Enforcement Agents enter the debtor's property and remove goods for sale. The goods must be of sufficient value to cover the debt, the Enforcement Agents' costs and the costs of sale.