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Council Tax debt ‘Breathing Space’ is the name of the new government initiative to assist those who have debts to be able to discuss those debts with a debt management agency and, where appropriate, enter a debt management scheme for those debts.

In June 2019 the government, having previously issued a consultation document, published an outline plan of how the new system would work in practice. For the purposes of council tax collection and enforcement this proposal would introduce some key changes in how the council tax system is currently implemented. In 2020 it was announced that these regulations would come in to place on 04 May 2021.

60 day freeze on recovery action

From the date of application to a breathing space authorised debt management agency, the council will have to free action on the debt which has been identified in the application. This would be undertaken for a period of up to 60 days (to be reviewed after the first 30 days).

Where a person is deemed to have mental health issues then, in defined cases, the freeze may be made for an indefinite period. This freeze on action would include any council tax monies which have become due up to the date of the application but would not include any council tax liability which had not yet become due.

Council Tax debts

Council Tax debts are not covered by the ‘Breathing Space’ scheme except in certain defined circumstances. These debts can be covered under the scheme only where the monies have become due in full – where a reminder has not been paid within 7 days or a final notice has been issued – or where a reminder notice has been issued.

(k)any liability in respect of council tax for a financial year, except where—

(i)all the instalments for that year have fallen due and any of those instalments has not been paid, or

(ii)a reminder notice has been served on the debtor under regulation 23(1) of the Council Tax (Administration and Enforcement) Regulations 1992

How can LGFA92 help ?

LGFA92 are not an authorised debt management company so will continue to deal with cases in the way in which we presently do. This means that although we cannot apply for a ‘Breathing Space’ order on your behalf we can act for you whilst one is in place in respect of the work which LGFA92 undertake.