Liability Orders...Government wants to substantially increase Attachment of Earnings Orders...Seeking help from HMRC.

[ploddertom]

Personally I like the stance of this Council who seem to be attempting to solve the problem first rather than heaping more misery by just using enforcement.

 

http://www.thewestonmercury.co.uk/news/council_stop_bailiff_cases_for_tax_collection_in_trial_1_4256943

 

Let's hope it succeeds.

[brassnecked]

Personally I like the stance of this Council who seem to be attempting to solve the problem first rather than heaping more misery by just using enforcement.

 

http://www.thewestonmercury.co.uk/news/council_stop_bailiff_cases_for_tax_collection_in_trial_1_4256943

 

Let's hope it succeeds.

Agree entirely PT anything that prevents a debt escalating beyond control for a low income family with bailiff involvement deserves to succeed.

[Peterbard]

Just to bump this thread.

 

Reports in the the trade press, report that the implementation of the fourteen day period and HMRC data sharing is imminent.

This is after a positive response to the proposal in the consultation.(above).

 

This has been confirmed in conversation with BA earlier.

 

The detail of how this is to be implemented seems to be unavailable at the moment.

[Bailiff Advice]

Just to bump this thread.

 

Reports in the the trade press, report that the implementation of the fourteen day period and HMRC data sharing is imminent.

This is after a positive response to the proposal in the consultation.(above).

 

This has been confirmed in conversation with BA earlier.

 

The detail of how this is to be implemented seems to be unavailable at the moment.

 

You and I have spoken about this proposal recently as there are quite a few hurdles that would have to be addressed and I wrote about these when starting this thread last October (see below):

 

http://www.consumeractiongroup.co.uk/forum/showthread.php?453537-Liability-Orders...Government-wants-to-substantially-increase-Attachment-of-Earnings-Orders...Seeking-help-from-HMRC.&p=4802617&viewfull=1#post4802617

 

Having read back through my posts in this thread, I would just like to re-iterate that the new proposals are intended to apply to all individuals who are employed (low income and high income).

 

However, the proposal in its present form cannot proceed and I have outlined the reasons to the relevant agency. One main reason (and there are more) concerns the '14 day' letter:

 

In the first instance, following the granting of a Liability Order it is proposed that the tax payer must be given a period of 14 days to voluntarily submit their employment details to HMRC (failing which, the local authority will approach HMRC for the employment details). The only way that this can be achieved is by amending legislation to re-introduce section 45a into the 1992 council tax regulations. This particular section made it a legal requirement that local authorities had to send a '14 day' letter to council tax payers after a Liability Order had been made. Section 45a was revoked in April 2014.

[brassnecked]

You and I have spoken about this proposal recently as there are quite a few hurdles that would have to be addressed and I wrote about these when starting this thread last October (see below):

 

http://www.consumeractiongroup.co.uk/forum/showthread.php?453537-Liability-Orders...Government-wants-to-substantially-increase-Attachment-of-Earnings-Orders...Seeking-help-from-HMRC.&p=4802617&viewfull=1#post4802617

 

Having read back through my posts in this thread, I would just like to re-iterate that the new proposals are intended to apply to all individuals who are employed (low income and high income).

 

However, the proposal in its present form cannot proceed and I have outlined the reasons to the relevant agency. One main reason (and there are more) concerns the '14 day' letter:

 

In the first instance, following the granting of a Liability Order it is proposed that the tax payer must be given a period of 14 days to voluntarily submit their employment details to HMRC (failing which, the local authority will approach HMRC for the employment details). The only way that this can be achieved is by amending legislation to re-introduce section 45a into the 1992 council tax regulations. This particular section made it a legal requirement that local authorities had to send a '14 day' letter to council tax payers after a Liability Order had been made. Section 45a was revoked in April 2014.

Are there not issues with this now that The Compliance Stage is in the hands of EA Companies and just reinstating the 14 day letter may need more tinkering?

[mikeymack2002]

Are you aware the LA'S are also trying to get the ok to take money from a debtor's DLA/PiP too?

 

'The ability to share information regarding DWP benefits via CIS for Council Tax payers where a liability order has been granted, and to be able to request deductions are made from other benefits, e.g. PIP/DLA and state retirement pension'

 

Since I'm on a mobile device I cannot add the PDF so will update shortly...

[Peterbard]

As per earlier in this thread there have been a few trials and these have produced vastly improved recovery rates. One of the problems is the increased costs which will be incurred by LAs.

They will need to send the letters( no small task on the amounts we are talking about) then liaising with HMRC , implementing the AOEs monitoring, et.

I suspect that they have found that even given all this there is still room for additional income over what they are receiving at the moment.

[mikeymack2002]

But the point I made was that they want to take money off of a disabled claimant.. For the purposes of debt (DLA) is classed as an exempt income. I am going to run this past the admin in the benefits section too. Which would be Anton. ..

[Bailiff Advice]

Are there not issues with this now that The Compliance Stage is in the hands of EA Companies and just reinstating the 14 day letter may need more tinkering?

 

As I have said above, there are quite a few problems with the proposal and although the '14 day' letter is the main one, there are many others;

 

With the '14 day' letter being revoked, local authorities have naturally made large savings in administration time and postage etc. These saving would come to an end for the following reasons:

 

This proposal would require over 3.5 million additional items of correspondence being sent by the local authority.

 

If the '14 day' letter were reintroduced, it would naturally add significant costs to the local authority. Not only would the local authority have to send these letters, they would also have to deal with the many replies with employment details (and no doubt complaints as well).

 

There would also be additional administrative costs on the local authority in setting up the Attachment of Earnings.

 

Additional administrative costs would also be incurred by the local authorities in making data requests to HMRC for employment details of those individuals who had failed to voluntarily provide their employment details.

 

The above are just a few hurdles that have to be overcome. There are many more.

[Peterbard]

I wonder how many LAs will still have procedures for sending these letters pre 2014 in place, which they can just reactivate.

 

As an aside many have criticised LAs for using bailiffs as opposed to AOEs, interesting to see that the AOE procedure is certainly no bed of roses either.

 

It is an impersonal procedure which just cuts your income overnight, no negotiation, no if or buts.

[mikeymack2002]

The fastest way to get this done maybe would be to add it to the guidance notes?

[sillygirl1]

Given that many councils only use liability orders as their main means of collecting once a debtor has missed a payment this can only lead to more poverty amongst the poorer debtor.

 

Council tax needs to be taken OUT of the priority debt status and they need to make councils negotiate with the debtor BEFORE getting a liability order - not the other way round.

[mikeymack2002]

DB looks like we have a subject we agree on for a change...

[Bailiff Advice]

But the point I made was that they want to take money off of a disabled claimant.. For the purposes of debt (DLA) is classed as an exempt income. I am going to run this past the admin in the benefits section too. Which would be Anton. ..

 

To avoid this subject going 'off topic' can I just say that the proposal under discussion is only in connection to Attachment of Earnings in relation to council tax payers who are in paid employment.

[brassnecked]

To avoid this subject going 'off topic' can I just say that the proposal under discussion is only in connection to Attachment of Earnings in relation to council tax payers who are in paid employment.

Yes the procedure for attaching to benefit would differ surely. However MM has a valid point regarding DLA/PIP as a council might attempt to attach to an award wholly funding a Motability Car with disasterous consequences, if attaching to those benefits has indeed now been allowed.

[Peterbard]

Yes the procedure for attaching to benefit would differ surely. However MM has a valid point regarding DLA/PIP as a council might attempt to attach to an award wholly funding a Motability Car with disasterous consequences, if attaching to those benefits has indeed now been allowed.

 

Certainly make a good thread, perhaps, "attachments to benefit payments for council tax debts"

[brassnecked]

Certainly make a good thread, perhaps, "attachments to benefit payments for council tax debts"

Started one here DB

 

http://www.consumeractiongroup.co.uk/forum/showthread.php?459899-Which-benefits-can-be-lawfully-attached-to-to-recoup-Council-Tax-debt-and-magistrates-fines&p=4859774#post4859774

[Consumer dude]

I have often wondered if there is any legal obligation to return an I&E form upon request..

[AndyOrch]

I have often wondered if there is any legal obligation to return an I&E form upon request..

 

There is if its in connection to an AoE or you could face 14 days imprisonment.

[Consumer dude]

There is if its in connection to an AoE or you could face 14 days imprisonment.

 

I am of course referring to the request after a liability order has been issued by the local authority. What is an AOE ?

[brassnecked]

I am of course referring to the request after a liability order has been issued by the local authority. What is an AOE ?

Attachment Of Earnings.

[Bailiff Advice]

I have often wondered if there is any legal obligation to return an I&E form upon request..

 

In answer to your question, the following is what I wrote on the first page of this thread:

 

 

 

Once a Liability Order has been obtained, the 1992 regulations (section 56) provide that the taxpayer is under a legal duty to provide when request employment details. If they refuse to do so, the taxpayer can face a criminal court fine. Yesterday I was sent details of one such fine that was issued a few days ago by Cheshire East Magistrates. The amount that the taxpayer has been fined is as follows:

 

 

Amount of Fine: £220

 

Victims Surcharge: £22

 

Costs: £75

 

Criminal Court Charge: £150

 

Total amount payable: £467

[Bailiff Advice]

In answer to your question, the following is what I wrote on the first page of this thread:

 

 

 

Once a Liability Order has been obtained, the 1992 regulations provide that the taxpayer is under a legal duty to provide when request employment details. If they refuse to do so, the taxpayer can face a criminal court fine. Yesterday I was sent details of one such fine that was issued a few days ago by Cheshire East Magistrates. The amount that the taxpayer has been fined is as follows:

 

 

Amount of Fine: £220

 

Victims Surcharge: £22

 

Costs: £75

 

Criminal Court Charge: £150

 

Total amount payable: £467

 

 

http://www.legislation.gov.uk/uksi/1992/613/regulation/56/made?view=plain

[Consumer dude]

Was my local authority breaking the law by implying that by not returning the I&E form following a liability order, that this would be a criminal offence..

[Peterbard]

These fines are a criminal sanction CD