Contracting out of Council Tax reviews of discounts, exemptions and liability is becoming a more common occurrence. Council Tax reviews are now being taken seriously.
Some problems may occur but in general the local authorities have a good record in ensuring records are updated correctly.
Why are the undertaking Council Tax reviews ?
A local authority has a legal duty to check in to any discount or exemption application and any Council Tax liability. In order to do so they make enquiries and request information to allow them to be satisfied that their records are correct.
Contracting out of data checking
The Local Authorities (Contracting Out of Tax Billing, Collection and Enforcement Functions) Order 1996 allows a local authority to pass almost all function of Council Tax to an outside company. These functions can include reviews of discounts, exemptions and liability if the local authority so wish.
If you are contacted by the authorised agents of the local authority you should respond in the same way as you would to the local authority.
National Fraud Initiative
In addition to any usual contracting out of data checking the local authority will also use the National Fraud Initiative (NFI). Every two years information will used through the NFI to cross-check against a range of records.
Data protection Act
Section 29 of the Data Protection Act 1998 (DPA) allows a local authority to request information for the assessment and collection of taxes without the DPA hindering in this matter. Any request however should be reasonable and within existing legal powers.
What can happen ?
The local authority is obligated to ensure Council Tax records are correct. They may update records based on the information they have collected.
If you have failed to notify a change to your local authority then a penalty may apply – in addition to any Council Tax which falls due. If you appear to have committed fraud legal action may be taken regarding this (example).
Remember that ignorance of the law is not generally a defence.
What can I do ?
If you dispute the decision made by the local authority you must firstly dispute it with them (or their authorised agents). If the local authority does not agree with your dispute then you may appeal to a Valuation Tribunal or the Local Government Ombudsman.
Need expert help or advice ?
This article is solely the view of LGFA92, the Council Tax agents and experts, based on our interpretation of legislation. Your local authority is free to dispute this view. A binding decision may require the intervention of a valuation tribunal.
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