Council Tax Arrears: Enforcement, Liability Orders, and Time Limits

When council tax goes unpaid in England and Wales, local authorities follow a statutory enforcement process that can ultimately lead to a court-granted liability order. This order significantly expands the powers available to the council to recover the debt. The process is governed primarily by the Local Government Finance Act 1992 and the Council Tax (Administration and Enforcement) Regulations 1992 (SI 1992/613), with additional regulations covering specific enforcement methods such as benefit deductions and enforcement agent fees.

This article explains how the liability order system works, the steps involved, the time limits that apply, and the enforcement methods that may follow. Scotland and Northern Ireland operate under different systems and are addressed briefly where relevant.

A council tax liability order is a statutory enforcement mechanism. It is obtained by a local authority from a magistrates' court and grants the authority enhanced powers to recover unpaid council tax. Before reaching the liability order stage, the council must follow a prescribed series of notices and waiting periods.

There is a six-year time limit for councils to apply for a liability order, running from the date the sum became due. Once a liability order has been granted, the Court of Appeal has held that there is no statutory time limit on subsequent enforcement action.

The enforcement framework in England and Wales is set out in Part VI of the Council Tax (Administration and Enforcement) Regulations 1992. It follows a staged process, beginning with reminder notices and potentially ending with enforcement measures such as attachment of earnings, benefit deductions, enforcement agents (formerly known as bailiffs), charging orders, bankruptcy proceedings, or committal to prison.

The process is sequential: each stage has conditions that must be met before the council can proceed to the next. The key stages are the reminder notice, the final notice, the application to the magistrates' court, the court summons, and the liability order hearing itself. Only after a liability order is granted does the full range of enforcement powers become available to the council.

The legal framework draws on several pieces of legislation:

• The Local Government Finance Act 1992 (primary legislation).
• The Council Tax (Administration and Enforcement) Regulations 1992 (detailed procedural rules).
• The Taking Control of Goods (Fees) Regulations 2014 (enforcement agent fees).
• The Council Tax (Deductions from Income Support) Regulations 1993 (legacy benefit deductions).

The Pre-Court Process

The enforcement process typically begins when a council tax instalment is missed.

1. Reminder Notice: Councils usually issue a reminder after a missed instalment; the reminder must give at least seven days to bring payments up to date.
2. Loss of Instalments: If payment is not made within seven days of the reminder, the right to pay by instalments is lost and the full annual balance becomes due under Regulation 23 of the 1992 Regulations.
3. Second Reminder: Councils may issue up to two reminders in a single financial year. If it is the third late payment in the year, the right to pay by instalments is automatically lost.
4. Final Notice: Following a missed reminder, the council serves a final notice demanding the full annual balance. Once the period specified in the final notice has elapsed without payment, the council may apply to the magistrates' court for a liability order under Regulation 34(1).

Wales Update: Wales is extending timeframes at the final notice stage from 1 April 2026 under The Council Tax (Administration and Enforcement) (Amendment) (Wales) Regulations 2025. The amending regulations introduce longer minimum periods before a final notice can be served and a longer period for the taxpayer to pay before the council can apply to court.

The Court Stage

The council applies to the magistrates' court for a liability order under Regulation 34 of the 1992 Regulations. The court issues a summons to the debtor. The summons may be served by delivery, by leaving it at the address, or by post. At the hearing, the magistrates' court considers the application and must grant the liability order if it is satisfied that the sum has become payable and remains unpaid. Attendance by the debtor is not compulsory.

The Six-Year Time Limit

A council may not apply for a liability order more than six years after the day on which the sum became due under Part V of the 1992 Regulations. This time limit is set out in Regulation 34(3). It is important to note that the six-year clock runs from when the council tax became due, not from the date of the demand notice.

Enforcement After a Liability Order

Once a liability order has been granted, the council may pursue various enforcement methods. According to the Court of Appeal in Bolsover DC v Ashfield Nominees [2010] EWCA Civ 1129, there is no statutory time limit for enforcement action once a liability order has been made.

The available enforcement methods include the following:

Attachment of Earnings

The council can apply for an order requiring the debtor's employer to make deductions from their earnings. Deduction rates vary by earnings band under Schedule 4 of the 1992 Regulations. The employer may deduct an administrative charge of £1 per deduction under Regulation 39(1).

Deductions from Benefits

• Legacy Benefits: For claimants receiving Income Support, Jobseeker's Allowance, Employment and Support Allowance, or Pension Credit, the deduction is 5% of the personal allowance for a single claimant aged 25 or over. Sources cite figures ranging from approximately £3.70 to £4.55 per week.
• Universal Credit: The deduction is calculated as 5% of the standard allowance, with sources citing figures in the approximate range of £3.75 to £4.25 per week.
• The precise figure changes annually as benefit rates are uprated.

Enforcement Agents (Bailiffs)

The council may pass the debt to enforcement agents. The fees enforcement agents may charge are fixed by the Taking Control of Goods (Fees) Regulations 2014:

• Compliance Fee: £75 per liability order when the debt is first passed to the agent.
• Enforcement Fee: £235 plus 7.5% of any amount of the debt exceeding £1,500 (if the agent visits the property).
• Sale or Disposal Fee: £110 plus 7.5% of any debt exceeding £1,500 (if goods are removed for sale). Fee rules apply per enforcement power, with specific regulatory provisions on how multiple debts are treated.

Charging Orders

Councils may apply for a charging order against the debtor's property. Councils generally reserve charging orders for larger arrears; no statutory minimum debt amount is set in the Charging Orders Act 1979 for local authority applications.

Bankruptcy

According to published guidance, the council may petition for bankruptcy where the debt is at least £5,000. This reflects the statutory minimum under the Insolvency Act 1986 for bankruptcy petitions.

Committal to Prison

Committal proceedings may be brought as a last resort. The maximum term is 3 months. According to published guidance, this remedy is only available after enforcement agents have attempted recovery and found insufficient goods, and it requires a means enquiry and a finding of wilful refusal or culpable neglect to pay.

• The six-year limit applies to obtaining the liability order, not to enforcing it. This is a frequent source of confusion. The six-year period in Regulation 34(3) restricts how long a council has to apply to the magistrates' court for a liability order. It does not limit how long the council has to enforce a liability order that has already been granted.
• The six-year period runs from when the tax became due, not from the demand notice. The regulations specify the period runs from "the day on which it became due under Part V," which is the statutory due date.
• Losing the right to pay by instalments does not mean the full year's tax is a new debt. When the right to instalments is lost, the full annual balance becomes payable. This is the acceleration of existing liability, not the creation of a new obligation.
• Attendance at the liability order hearing is not compulsory. The court summons requires the debtor to attend, but the court may proceed and grant the order in their absence.
• Enforcement agent fees are regulated, not discretionary. The fees are fixed by law and are not set by the agent or the council.

• Scotland operates a different system. Scotland does not use liability orders. Instead, local authorities obtain summary warrants from the sheriff court, which carry an administration surcharge added to the debt. Different prescription rules apply in Scotland.
• Northern Ireland does not have council tax. Northern Ireland operates a domestic rates system under separate legislation entirely.
• Wales regulatory changes from April 2026. The Council Tax (Administration and Enforcement) (Amendment) (Wales) Regulations 2025 introduce longer timeframes at the final notice stage in Wales from 1 April 2026.
• Joint and several liability. Where multiple people are jointly and severally liable for council tax, the council can pursue any liable person. Payment by one liable person reduces the joint liability accordingly.
• Breathing Space scheme. The Breathing Space scheme provides a period of 60 days during which creditors cannot contact the debtor or take enforcement action. Council tax arrears qualify for Breathing Space.
• Unreasonable delay in enforcement. While there is no statutory time limit for enforcement after a liability order has been made, unreasonable delay in taking enforcement action may, according to published guidance, give grounds for a complaint to the Local Government Ombudsman on the basis of maladministration.

The council tax enforcement process in England and Wales moves through defined stages, each governed by specific regulations and timeframes. A missed payment leads to a reminder, a reminder leads to a final notice, and a final notice leads to a court application. The court issues a summons, and if it is satisfied the debt is due and unpaid, it must grant the liability order.

Once a liability order exists, the council has a range of enforcement tools at its disposal. The method chosen may depend on the debtor's circumstances — whether they are employed, receiving benefits, or own property. Each method has its own rules and regulated costs. Enforcement agent fees, for example, follow a fixed statutory schedule rather than being set at the agent's discretion.

The six-year time limit is significant at the pre-order stage: it prevents councils from applying for liability orders on very old debts. However, once the order is granted, the absence of a statutory time limit on enforcement means that liability orders can remain active indefinitely, although unreasonable delays may be challenged through the Local Government Ombudsman.

• Sequential Process: Reminder > Final Notice > Court Summons > Liability Order. Strict order.
• Liability Order: A Magistrates' Court order that gives the council power to use bailiffs or deduct from wages/benefits.
• 6-Year Rule: Council must apply for the order within 6 years of the tax becoming due.
• Indefinite Enforcement: Once they have the order, there is no fixed time limit to use it (Bolsover DC case).
• Fixed Fees: Bailiffs cannot just make up fees. They are set by law (e.g., £75 compliance stage).
• Scotland/NI Different: This guide is for England & Wales. Scotland uses Summary Warrants; NI has rates.