Luton Borough Council

What happens if I don't pay?

If you have received letters from the Business Rates section regarding unpaid business rates you may be wondering what you should do and what could happen next.

Below is a list of the types of letters we send out and what they mean.

Bill / demand notice

Why is it sent? - A bill will show how much you owe in business rates for the year and will normally show what instalments you should pay and when. They are normally sent at the start of the financial year, or if your rates bill alters during the year (eg changes in relief entitlement or rateable value or if you move business premises).

At the start of the rating year each ratepayer is entitled to ten or 12 instalments. If you want 12 instalments please let us know in writing before the first instalment due date. The amount of instalments will reduce the further into the rating year you go. If you are moving into or out of a property, you can download the form below, complete it and return it to us so we have accurate information regarding your account.

What should I do? - Pay the instalments before the due dates as the payment is due on your account by the instalment date.

What if I cannot pay as billed? - Pay as much as possible as regularly as possible. If you are paying less than the due amount or paying after the due date then you will receive further notices. The revenues staff will not hold action at this stage unless there are exceptional circumstances.

First reminder

Why is it sent? - This is sent because our records show that you have fallen behind with your payments. This usually means you have not paid an instalment on time or that you paid less than you should have done. It may also be sent if you still owe money from a previous year.

What should I do? - You should bring your account back up to date within the specified time. If an account is brought back up to date and kept up to date, no further letters will be sent.

What if I cannot do this? - If you do not bring your payments up to date you will lose your right to pay by instalments. No further reminders will be issued and the next document you receive will be a court summons for the full balance on your account.

If you are unable to pay as required you must contact the Business Rates office immediately.

Final notice

Why is it sent? - This is normally sent if you have had a first reminder, brought your account up to date and then fallen behind for a second time. This letter will not be asking for the instalments that have been missed. This letter cancels your right to pay by instalments and you will be asked to pay the remaining balance on your account in full.

What should I do? - You must pay the balance on your account in full within the specified time. If you pay the account in full you will not be sent any more letters.

What if I cannot do this? - If you do not pay the account in full you will be sent a Magistrates' Court Summons (see below). If you cannot pay in full you should pay as much as possible as regularly as possible. The revenues staff will not re-instate instalments unless there are exceptional circumstances, nor can they set up arrangements at this stage.

Magistrates court summons

Why is it sent? - This is sent to tell you that because you are in arrears and we are going to Court to obtain a Liability Order against you. This is a legal document which states how much you owe us and it gives us the power to send your account to an enforcement agent. Summons costs of £83 are added to account.

What should I do? - You must pay in full before the Court date. If you pay the balance in full before the Court Date you will not be sent any more letters. The council will still apply to the Magistrates Court for the £83 costs and this will become part of your outstanding balance. Once the Magistrates Court has issued the Liability Order, if you have not settled your account it will be sent directly to our enforcement agent for enforcement.

What if I cannot do this? - If you cannot pay before the Court Date, but wish to make an arrangement to clear your account please contact us straight away. Any arrangement that you make will still include the summons costs unless you are able to set up a Direct Debit before the Court date, but if you keep to the arrangement we will not take any further action against you. The revenues staff will not cancel a summons even if you bring your account up to date.

Once an account has been to Court there are various courses of action that we may take, depending on what we believe is the best way to secure payment. These are:

Make an arrangement

You can make an arrangement to clear your arrears by making regular weekly, fortnightly or monthly payments direct to us. The arrangement set, must clear your full balance within this financial year.

Arrangement can be made online. To make a request for an arrangement please complete our enquiry form. Please tell us clearly how much you can pay and over what period of time. Request for arrangements that go beyond the end of the financial year are at our discretion and are only accepted under exceptional circumstances.

If an arrangement is broken, we will take one of the following courses of action:

Enforcement agent

We may pass your account to an enforcement agent for collection. The enforcement agent has the power to uplift goods, and you will incur further costs as follows:

Ratepayers will have to pay a £75 Compliance fee as soon as we pass an unpaid account to the agent for collection. This fee is payable per individual Order.

You will also have to pay a further Enforcement fee of a least £235 if you do not make arrangements to pay or default on payments and a visit becomes necessary. This is a one off fee regardless of the number of Liability Orders.

You will also have to pay at least a further £110 at the sale or disposal stage.

A further 7.5% fee will also be charged on any additional amount above £1500, excluding fees. This is only chargeable at the enforcement or sale/disposal stages.

We strongly recommend that you make an arrangement with us before your account reaches this stage.

Committal proceedings (sole trader / named on bill)

Where no other form of recovery has been successful, we may start proceedings to have an individual committed to prison or a declared bankrupt or a company made bankrupt.

If you receive a committal warning you must make an arrangement to clear the debt. If committal action is taken it will be for the amount of Business Rates owed and any enforcement/court fees.

Failure to make payments or an arrangement for payment could ultimately result in you being committed to prison for a maximum of three months

Bankruptcy proceedings

If a liability order has been granted for over £750, we can petition for your bankruptcy (sole trader), or liquidation (company). You will be served with a Statutory Demand giving you 21 days to clear the debt in full. If you cannot pay, we would seek to make you bankrupt. This action, if successful, will affect your credit rating and may lead to you losing your home and any other assets you own.

Contact info

Business rates
Luton Borough Council, Town Hall, George Street, Luton, Bedfordshire, LU1 2BQ
Tel: 01582 546035 or minicom 01582 414367
Fax: 01582 546977
[email protected]