Council tax fraud appears to be an increasing problem. It is often assumed that as it’s ‘just council tax’ no harm will come of it and if they get caught they’ll simply get a revised council tax notice in the post. This is not always the case.
Most common type of fraud
The most common case within council tax is the false claiming of the 25% reduction for sole occupancy , the ‘single person discount’. Most local authorities will use data they have to hand, and often external tracing agencies, to try to limit the fraud however they are also required to submit information to the National Fraud Initiative.
The National Fraud Initiative
The National Fraud Initiative (NFI) is a data matching exercise which matches information from public and private sector organisations in order to establish any links which need a further investigation. The 2014 NFI report identified approximately £39 million in wrongly claimed single person discounts. These were subsequently withdrawn and revised council tax demands issued. North East Lincolnshire Council alone found that a third of single person discounts they reviewed in 2014 were wrong.
Actions to deal with fraud
With the ongoing cuts to local authority budgets many are now actively cracking down further on fraudulent applications and are prosecuting those who do so. Having lagged behind for many years in protecting the public purse it is slowly changing for the better. Many types of fraud which would previously have been missed are now being detected and enforcement action taken.
A recent case from Bedford saw a man convicted of 4 counts of fraud and fined £710 for wrongly claiming to be a student. After ceasing to be a student he submitted false documentation showing that he was still a full-time student.
It should be remembered that removal of a council tax reduction and prosecution does not alter the fact that the council tax charge is due. Failure to pay this amount may result in a court summons and ultimately a trip back to the magistrates court for committal to prison for non-payment.
Advice & Assistance from LGFA92
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This article is solely the view of LGFA92, the Council Tax 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.