Martin Lewis has issued a warning to UK households not to fall foul of a “destructive” missing payment mistake that can have disastrous consequences for your finances.
The MoneySavingExpert (MSE) founder has urged households to make sure they don’t miss a Council Tax payment or within just three weeks they could be asked to pay their annual bill in full.
Martin warns that councils can not only ask for a full annual bill payment, but they can demand this is paid within just seven days.
Households that fail to do this in time can then be taken to court by their council and receive a court summons for the year’s bill by week four, with potential extra charges on top for ‘administration fees’.
By week six, Martin says you could be a ‘liability order’ which allows local authorities to pursue more aggressive forms of debt collection, meaning you could end up with bailiffs knocking at your door for the year’s bill.
Martin slammed the system as “destructive” on his Martin Lewis Money Show Live, saying he would choose to go without food in order to pay his Council Tax bill on time.
Standing on his soap-box during his ITV show, he said: “I would like to know what makes councils think that someone who cannot make their monthly repayment can afford to pay for the entire year. How does that help someone’s finances?
“It is counterproductive. It is destructive, even if you do not have mental health problems. And it doesn’t mean councils will get their money back in a way they should.
“They are destroying people’s long term financial lives by this aggressive form of debt collection.”
Martin said that even a commercial debt company isn’t allowed to collect money in such a manner, with the likes of credit card firms required by regulation to go through more steps before demanding a full repayment.
This process typically takes between three to six months – a stark contrast to the mere three weeks councils can start to take action.
Martin says it highlights how constituents are treated far worse than customers would be as he called on the government to change the system.
He added: “To central government, I would say we need to put the same onus on councils as we do on commercial lenders to treat people fairly.”
