Summary: Miss B complained about the Council’s action in respect of council tax involving her business. She said the Council delayed in responding, then gave her incorrect advice, proceeded with recovery action even though she had made a complaint and delayed in responding to her complaint. We found fault with the Council’s actions. It has agreed to pay Miss B £500 and improve its procedures for the future.

The complaint

1. Miss B complained that Leeds City Council (the Council) gave her incorrect advice about her council tax liability and that it was wrong to take recovery action on the account, including sending her a summons. Miss B says this hindered progress on the opening of her business and impacted on her mental health. Miss B seeks a financial payment from the Council in recognition of this.

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The Ombudsman’s role and powers

2. We investigate complaints about ‘maladministration’ and ‘service failure’. In this statement, I have used the word fault to refer to these. We must also consider whether any fault has had an adverse impact on the person making the complaint. I refer to this as ‘injustice’. If there has been fault which has caused an injustice, we may suggest a remedy. (Local Government Act 1974, sections 26(1) and 26A(1), as amended)
3. The law says we cannot normally investigate a complaint when someone can appeal to a tribunal about the same matter. However, we may decide to investigate if we consider it would be unreasonable to expect the person to appeal. (Local Government Act 1974, section 26(6)(a), as amended)
4. The Valuation Tribunal deals with appeals against decisions on council tax liability and council tax support or reduction.
5. If we are satisfied with an organisation’s actions or proposed actions, we can complete our investigation and issue a decision statement. (Local Government Act 1974, section 30(1B) and 34H(i), as amended)

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How I considered this complaint

6. I have considered the complaint and the documents provided by the complainant, made enquiries of the Council and considered the comments and documents the Council provided. Miss B and the Council had an opportunity to comment on my draft decision. I considered any comments received before making a final decision.

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What I found

7. In June 2021 Miss B’s business took on the tenancy of a property in Leeds, which she intended to use to house and care for two children under 18. The Council sent a bill for council tax for the rest of the financial year to Miss B and her partner. In July 2021 Miss B telephoned the Council to explain the status of the property. The Council said it might be exempt due to being a children’s home and asked Miss B to provide some more information.
8. Miss B sent an email to the Council in August 2021. She said her and her partner were directors of the company which rented the property, but they did not live there. She said she had taken advice and believed they should be exempt from paying the council tax. The Council asked for further details of the children and when they moved in. Miss B queried this request for data protection reasons and said they had not moved in because they were still awaiting OFSTED registration.
9. On 15 October 2021 the Council sent an email saying that Miss B did not need to provide the details of the children as they would be under 18 and not liable. It went on:

“Please can you confirm what date [the Company] took over the tenancy and I will award the exemption at the address.”

10. Miss B provided the information. On 5 November 2021 the Council advised Miss B by email that it had registered the company as liable for council tax from 1 June 2021, it was currently marked as unoccupied and full council tax was charged for empty properties. It said that once the children moved in the Council would apply the exemption to the property. Miss B received a bill for £1165.
11. Miss B complained at the sudden change of view that council tax was now payable. The Council apologised for the confusing information and clarified that the property was chargeable until the children moved in when the exemption would be applied.
12. In December 2021 the Council applied the long term empty property premium to the account increasing the amount payable and sent an adjusted bill. Miss B complained about the increased charge and the time the Council had taken to get to this point. She asked for her complaint to be escalated to stage two.
13. In February 2022 the Council sent a new bill for the next financial year and in March a summons for the current year’s bill.
14. In April 2022 Miss B contacted the Council to query why she had been sent a summons when she had an outstanding complaint and that she had not received a reminder. The Council said it would call her back. In the meantime, it removed the summons and the costs. It asked Miss B to provide further information about the property. She confirmed it was fully furnished and always had been . The Council removed the long term empty property premium and sent an adjusted bill allowing Miss B to pay by instalments.
15. Miss B said she had been misadvised and should be paid compensation. She said no children were occupying the property as she was still waiting for OFSTED registration and for the planning department to approve a change of use of the property.
16. In May 2022 the Council responded to her complaint. It apologised for the incorrect advice, the delays and the frustration caused. It confirmed that the email sent on 15 October 2021 was incorrect because an exemption could only be given when the property is exclusively occupied by people under 18. But it said the correct information was given to Miss B at the beginning of November 2021. It apologised for the failure to escalate her complaint to stage two until April 2022. It said it had removed the summons, the costs and the empty homes premium. It said it could not award any compensation because the council tax was payable.
17. Miss B complained to us. Planning approval for the change of use was awarded in April 2022. OFSTED registration has not been completed.

Analysis

18. The Council took too long to answer Miss B’s straightforward query about her liability for council tax at the property. She first contacted the Council in July 2021, and it did not provide correct advice until November 2021. This was fault. It caused frustration and confusion at a difficult time when Miss B was trying to establish a new business.
19. The Council exacerbated the situation by adding the long term empty homes premium without checking the details of the property and simply sending an increased bill to Miss B. This was fault.
20. It also failed to escalate Miss B’s complaint for four months and during this period commenced recovery of the outstanding council tax. This was fault.
21. Miss B had a right of appeal to the Valuation Tribunal about the exemption and premium. This was detailed on the back of the council tax bills she received. But I consider the Council should have informed her of this right when she complained about the bill in December 2021. The failure to do so was fault.
22. However, from November 2021 the Council made clear that Miss B’s company was liable for council tax until the property was occupied by people under 18. This could not happen until the Council granted planning permission for a change of use to a children’s home and OFSTED registered it. Planning permission was granted on 26 April 2022 and OFSTED registration is not yet complete. So, I do not agree with Miss B that the delay in providing correct advice about the council tax liability affected the establishment of the business from June 2021.
23. But I do consider the delay in providing correct advice, along with the failure to remind her of her right of appeal against the bill and the delay in responding to her complaint caused her frustration, distress and time and trouble.

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Agreed action

24. I welcome the fact that the Council apologised, removed the extra premium from the bill along with the summons and additional costs. I also note it has held recovery action on the account while we consider the complaint.
25. However, to recognise the injustice caused to Miss B by the delay and the wrong advice, I recommended the Council within one month of the date of my final decision:
• pays Miss B £500 (which can be offset against the outstanding council tax); and
• takes steps to ensure that council tax queries are answered within one month, that the right of appeal is explained and that complaints are escalated promptly once a request is made.
26. The Council has agreed to my recommendations.

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Final decision

27. I consider this is a proportionate way of putting right the injustice caused to Miss B and I have completed my investigation on this basis.

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Investigator's decision on behalf of the Ombudsman