A council taxpayer who owes more than just the current year's liability runs the risk of incurring additional recovery costs through a further application for a liability order if payments which are intended for the current year's liability are allocated by the council's computer to the previous year's liability. This would most likely happen where a non specific payment is made and the computer software is set to automatically allocate these payments to the oldest year's debt.
Councils computer systems have the necessary flexibility to be set to allow non specific payments to be allocated to the arrears or the current year's liability.
I understand that the majority of billing authorities have their computer software set to ensure that their customers are not subject to unnecessary recovery action, additional costs or hardship, i.e. so non specific payments are allocated to the current year's liability.
How does South Oxfordshire Council have its computer software set to deal with non specific payments. Current or oldest year's liability?
be sent to you within 20 working days.
The deadline for this will be 17 November 2017.
The reference number for these requests are Vale 17/659 and South 17/476.
allocate these payments to the oldest year's debt.
payments are allocated to the current year's liability.
with non specific payments. Current or oldest year's liability?
exemptions apply to your request.
unrecognised payment received against the oldest debt.
find further information at www.ico.gov.uk .
Thank you for stating that 'both SODC & Vale the system is set (unless specified otherwise) to allocate any unrecognised payment received against the oldest debt'.
Would you please confirm whether or not any measures are in place to check that allocating an unmatched payment to the oldest debt in these circumstances would have the consequences of putting the current year's liability also in arrears, and if so, in accordance with R. v Miskin Lower Justices  1 Q.B. 533, whether the payment would be moved in respect of the current year's account to avoid unnecessary recovery action, additional costs etc.?
I will check this matter and reply to you ASAP.
reflect a fixed payment plan.
I would like to query the above elements of your response (in order).
1. This would seem to achieve nothing in the way of benefiting the customer. The net result would mean that rather than having ONE year's liability subject to potential enforcement, bankruptcy, committal proceedings or a charging order, the customer would have TWO year's liability potentially subject to those burdens.
3. It is not the purpose of statutory notices (reminders, final notices etc.) to alert customers that the billing authority may have wrongly allocated payments. The notices are to inform the customer that they need to pay a certain amount by a due date to avoid further action being taken. This is one reason why statutory notices can not play a legitimate part in the appropriation process, another being they cannot be relied on as the law provides that a taxpayer has only a limited number of chances before no more reminders are issued.
anyway so there are no installments.
point in time to change our procedures.
liability potentially subject to those burdens.
to pay a certain amount by a due date to avoid further action being taken.
no more reminders are issued.
Thank you for your response. I consider South Oxfordshire District Council has provided the information I requested, however, the purpose of this exercise was to ascertain whether or not the principles surrounding the appropriation of payments were being adhered to.
It was held in R v Miskin Lower Justices, that where an amount obviously relates to a specific liability, it would be an unwarranted assumption to allocate the payment elsewhere.
If no instruction is given at the time of payment, then the council has a duty to allocate payment to the account which it is most beneficial to the debtor to reduce. That would be in the majority of cases the current liability if the consequences of allocating payment to the arrears meant that the customer was subject to unnecessary recovery action, additional costs etc.
I understand from the council's explanation that there are no measures in place to ensure that unspecified payments are allocated to the account which it is least burdensome for the debtor (except relying on customer contact on being served a statutory notice) that the laws surrounding the appropriation of payments are not being complied with. If the laws of appropriation were being complied with, an unmatched payment allocated to the oldest debt (having the consequences of putting the current year's liability also in arrears) would be reallocated to the current year's liability on account of the circumstances implying that this was the debtor's intention (least burdensome for the debtor).
A percentage of customers will have reached a stage where they have been served the maximum number of statutory reminders the law permits for the year and so a subsequent failure to keep their account up to date (or perceived failure) will result in the demand for the outstanding liability for the year.
For the above to be strictly relevant, an instalment paid in these circumstances would need to be returned to the customer. I doubt this ever happens.
I have pass this on to our revenues manager for review.
appropriation of payments were being adhered to.
debtor's intention (least burdensome for the debtor).
back on track (or ahead), then that action can be cancelled.
consuming, does mean that recovery action is minimized where possible.
run the risk of receiving reminders and robust notices.
payments have gone and hopefully makes things clearer for our customers.
as low as possible, which is very important for our residents.
Re; "The councils do not share your opinion that in the majority of cases it is most beneficial to allocate payment to the current year. Whilst it would be extremely beneficial for the council’s own in-year collection levels if it did take this approach, it would certainly not benefit the majority of taxpayers."
You have stated the above apparently without regard for payments being non-specified (unmatched). I of course didn't mean payments which were obviously intended to credit the arrears should be allocated to the current year. The in-year collection levels would not artificially be inflated if payments were allocated to the year's liability which the customer intended whether they be matched or unmatched.
It might be worth taking into consideration the following (see link) which appears to be guidance to local authorities summarising relevant case authority concerning appropriation of payments.
"It follows that it is not essential for there to be a specific expression by the debtor as to which account is to be credited. The intention may be gathered from other circumstances or IMPLIED BY THE DEBTOR'S LIABILITY that it would be an unwarranted assumption to allocate it elsewhere (R v Miskin Lower Justices (1953) 1 QB 533). "
Hence, if the laws of appropriation were to be complied with, an unmatched payment allocated to the oldest debt (having the consequences of putting the current year's liability also in arrears) would require reallocating to the current year's liability. The circumstances would imply that this was the debtor's intention as it would be least burdensome for him and would be an unwarranted assumption to do differently.
Thank you for the provided information and subsequent clarification which satisfies my request. I am not expecting any further response.