Recovery - If you don't pay your Business Rates
If you are struggling to pay please contact us as we may be able to offer you a special payment arrangement. We can also check that you have all the reliefs you are entitled to.
You must either:
- pay your Business Rates in full at the start of the financial year
or - by instalments
What happens if I don't pay?
If you choose to pay by instalments and fall behind, we will send you a reminder. This will give you seven days to pay. If you fail to make a payment within the seven days you will lose the right to pay by instalments and you will have to pay the full amount on your account immediately.
Should I wait for reminders?
No. You could lose the right to pay by instalments. If we have sent you a reminder for late payment and any of your future payments are late, you will have to pay the rest of the year's business rates immediately.
What happens next?
Fourteen days after sending you a reminder, legal action can start. We will apply to the Magistrate Court for a summons to be issued. You will be notified of the date and time of the hearing together with the costs of taking this action.
If you pay the amount due, shown on the summons, before the day of the Hearing, no further action will be taken.
If you do not pay, the Magistrates must issue a Liability Order.
If you are struggling to pay, please contact us as we may be able to offer you a payment arrangement for the balance included in the summons. We can also check that you have all the reliefs you are entitled to.
What is a liability order?
A liability order gives the council powers to collect the debt in various ways.
At this stage, we may still agree a payment arrangement with you rather than use the liability order. If you break the arrangement, we will take further action.
Please note that a Liability Order does not affect your credit score as it is not a County Court Judgement (CCJ).
Further action
We may pass your account to Enforcement Agents to collect the debt. The charges involved are set out in legislation. They can be considerable and you will be liable to pay them. The Enforcement Agents will ask our advice if they find the Liability Order has been issued against someone who cannot pay due to their vulnerability.
If we have tried using Enforcement Agents but your Business Rates still aren’t paid in full, we may apply to the Magistrates' Court for your committal to prison. You can be committed to prison if you refuse or neglect to pay your business rates.
The Magistrates will examine how the debt arose and, if they determine that you have refused or neglected to pay, they will impose a prison sentence.
You have the right to seek legal assistance for this hearing and you may be entitled to Legal Aid. The Magistrates may suspend a prison sentence pending payments being made under an arrangement. This can lead to further court costs being awarded against you.
If we have been granted a Liability Order and your Business Rates still aren’t paid in full, we may, in certain circumstances, start bankruptcy proceedings against you.
We will firstly issue a statutory demand, giving you 21 days to pay the amount due in full. If you do not pay the amount in full within 21 days, or take no further action, then we will apply to the County Court for a Bankruptcy Order. If such an order is made against you, the official receiver will take control of your financial affairs for the next three years.
You will also be liable for the substantial legal fees and disbursements (payments made from a private or public fund) incurred in this process.
If you are subject to an Independent Voluntary Arrangement (IVA), Company Voluntary Arrangement (CVA), Debt Relief Order (DRO), Bankruptcy, Liquidation or Administration, please contact us with details and evidence immediately as this will in some cases stop recovery action on your account.
If we have been granted a Liability Order and your Business Rates are still not paid in full, we may, in certain circumstances, apply to the County Court for a charging order.
This will place a secured charge on your property leading, in some cases, to the forced sale of your property to pay the outstanding Business Rates.
You will also be liable for the legal fees and disbursements incurred in this process.
If you have any queries about this or need to discuss your account, please contact us.
Last updated 01 November 2024