Summary: Miss X complains about the handling of her Council Tax accounts by the Council. Miss X also contends that her place of study should otherwise attract a student exemption. We have concluded our investigation having made a finding of fault. We found that the Council did not bill Miss X correctly during her occupancy of Property A and did not correct the Council Tax bill until two years later causing Miss X an injustice. We have not investigated any complaint about Council Tax liability, nor Miss X’s right to a student exemption as it is reasonable for Miss X to appeal these matters to the Valuation Tribunal. The Council has accepted our recommendations.

The complaint

1. Miss X complains about Council Tax liability having received a backdated bill for arrears from 2021. Miss X says she was not made aware of the liability as soon as practicable by the Council and as such would not have taken such a tenancy. Miss X also asserts that, in any event, her place of study should otherwise attract a student exemption. Miss X would like the Council to waive the amounts it is requesting.

Back to top

The Ombudsman’s role and powers

2. The law says we cannot normally investigate a complaint when someone has a right of appeal, reference or review 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 use this right. (Local Government Act 1974, section 26(6)(a), as amended)
3. The Valuation Tribunal deals with appeals against decisions on council tax liability and council tax support or reduction.
4. 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)

Back to top

What I have and have not investigated

5. I have not investigated any complaint regarding Council Tax liability, nor Miss X’s right to a student exemption. These are matters for the Valuation Tribunal and it is reasonable to expect Miss X to use her right of appeal should she have any issues regarding these matters.

Back to top

How I considered this complaint

6. I liaised with Miss X and considered the information she provided. I also made enquiries with the Council and considered the information it provided in response. Miss X and the Councill were offered an opportunity to comment on my draft decision and I considered any comments submitted before making a final decision.

Back to top

What I found

Relevant law and guidance.

Council Tax

7. The Council Tax (Administration and Enforcement) Regulations 1992 cover both the way councils collect payments of council tax, and the way councils can recover council tax debt.
8. The council tax bill for the year is due on 1 April. A council will usually collect payment through monthly instalments. If any instalment is missed, the council will send the liable person a reminder. If a payment is still not made or a further payment missed, then the entire outstanding balance will be due (that is the full amount for the rest of the year).
9. The courts found that the relevant date for liability should be calculated according to statutory principles, not the date the taxpayer first learned of the decision of the authority. (Hammersmith & Fulham Billing Authority v Butler [2001 (RVR 197)] )
10. The amount of council tax due for a property can be ‘reduced to such an extent as the [council]… thinks fit’. Councils have the discretion to reduce the council tax on a property in its area to nil if it decides it is appropriate to do so. (The Local Government Finance Act 1992, section 13A(1)(c)

Discounts and exemptions

11. The Local Government Finance Act 1992 sets out several discounts and exemptions, based on the state of the property and the number or type of occupants. Some are mandatory and others discretionary. Within their council tax scheme, each council has its own set discounts and exemptions.

Back to top

What I found

12. I have included a summary of some of the key events in this complaint. This is not intended to be a comprehensive account of everything that happened.

Background

13. During events in this complaint, Miss X was studying at an educational institution which is located in South Africa. The educational institution provides most of its learning through distance learning. Whilst studying at this educational institution, Miss X was residing in Brighton.

What happened

14. From August 2021 to August 2022, Miss X lived in Property A with three other students.
15. In December 2021, the Council says it sent an initial bill for Property A showing 100% student exemption.
16. In March 2022, the Council says it sent an annual bill for Property A 100% showing 100 % student exemption.
17. In September 2022, the Council says it sent a closing bill for Property A showing 100% student exemption.
18. From September 2022 to August 2023, Miss X lived in Property B with four other students.
19. In November 2022, the Council says it sent a bill for Property B showing a Council Tax liability for £1,016.
20. In March 2023, the Council says it sent an annual bill for Property B showing a Council Tax liability for £1,980.
21. In August 2023, after Miss X and her housemates moved out of Property B, the Council says it closed the account, however it came to its attention that a 25% student disregard should have been awarded and the other persons names removed as exempt.
22. The Council says that in August 2023, whilst working on the Council Tax account for Property B, it noticed its error that an exemption had been awarded on the incorrect grounds that all occupants were students at Property A. The Council sent revised bills for both addresses in the sole name of Miss X, giving rise to a total Council Tax liability of approximately £2,700.
23. Miss X complained to the Council, and in light of its error, the Council offered a repayment arrangement over several years.

Back to top

Analysis

24. As set out in paragraph 5, I will not, and have not investigated any complaint about Council Tax liability, nor Miss X’s right to a student exemption; this is a matter for the Valuation Tribunal. The evidence demonstrates that Miss X has been given her right of appeal and it is reasonable to expect Miss X to exercise this should she have issue with either of these matters. Instead, my investigation focuses on the handling of Miss X’s Council Tax accounts.

Has the Council acted with fault?

25. By the Council’s own assertion, it says that a student exemption was awarded on the incorrect grounds that all occupants were students at Property A. The Council says this error was picked up when working on the Council Tax account for Property B, two years later. The Council incorrectly applying a student exemption and raising a bill for a Council Tax liability two years later is fault.
26. I also consider the Council have acted with fault in how it billed for Council Tax liability at Property B. This is because it did not apply the correct 25% student disregard until August 2023, when it should have been applied when the occupants began their tenancy in September 2022.

Have the Council’s actions caused Miss X an injustice?

27. As part of my enquiries, I asked the Council to comment on Miss X’s assertions that she would not have pursued a tenancy at Property B with other students had she known she would be liable for the whole Council Tax liability. In response, the Council said it is not sure under what circumstances the Council could have informed Miss X of her potential liability for payment of Council Tax prior to her taking the tenancy at Property B, but I disagree. This is because had the Council billed Miss X correctly by not applying a 100% student exemption discount whilst she occupied Property A, she would have been aware of any future potential liability for payment of Council Tax.
28. I cannot say what choice Miss X would have made had she been aware of a Council Tax liability after residing in Property A, but I accept that the Council’s actions have prevented Miss X from making a more informed decision later. Had the Council not incorrectly applied a 100% student exemption to Property A, and billed Miss X correctly and sooner, she would have been more informed about whether to pursue a tenancy at Property B with other students, where she would be liable for the whole Council Tax liability. The Council’s actions have caused Miss X an inconvenience, and this is the injustice. I also consider there is further injustice to Miss X, which is the avoidable distress of raising a Council Tax bill some two years later, when Miss X was under the impression that she did not owe anything. This would have been stressful and frustrating for Miss X receiving such a large bill after the fact.
29. I do not consider that Miss X has been caused a significant injustice by delay in applying the correct 25% student disregard to Property B. I cannot see that Miss X made any payments towards the account, and as such, any delay in applying the correct discount has not impacted Miss X in any way.

Back to top

Agreed action

30. As per our published Guidance on Remedies, where we decide it is appropriate, we will normally recommend a remedy payment for distress of up to £500. My proposed remedy reflects all the circumstances, including but not limited to the severity of the distress, the length of time involved, and the individual circumstances of Miss X.
31. I consider that in this instance, the inconvenience imposed on Miss X, and the stress and frustration imposed having raised a bill for Council Tax liability two years later has caused significant avoidable distress. Miss X is a student, and as she describes, such a bill places her under significant financial hardship. I therefore consider it is appropriate to make an award toward the higher end of our range, for £400.
32. To resolve matters and prevent similar occurrences, the Council has agreed to:
1. Pay Miss X an amount of £400. This is to acknowledge the distress and inconvenience caused because of incorrect and avoidable delay in billing.
2. Explain what it will do to ensure that correct exemptions and discounts are applied at the earliest convenience.
33. The Council will complete action point a within one month of the Ombudsman’s final decision and action point b within two months of the Ombudsman’s final decision.

Back to top

Final decision

34. I have concluded my investigation having made a finding of fault. I found that the Council did not bill Miss X correctly during her occupancy of Property A and did not correct the Council Tax bill until two years later causing Miss X an injustice. We have not investigated any complaint about Council Tax liability, nor Miss X’s right to a student exemption as it is reasonable for Miss X to appeal these matters to the Valuation Tribunal. The Council has agreed to our recommendations.
     

Investigator’s final decision on behalf of the Ombudsman

Back to top

Investigator's decision on behalf of the Ombudsman