Reply To: IVA – Council Tax Support / Liability


I am doubtful that the IVA applicant should be removed from the account. They still have a liability even if it can only be collected at a much lower rate.

The legal position is that Council Tax should write the difference off between the liability and the amount received under the LGFA….but we know how much they love to do that (lol). So what they are trying to do is not to write anything off under the IVA and pass the full debt off to the remaining liable person. That raises issues such as can the latter then get the 25% discount. i dont see how.

To put it another way, if the Individual Voluntary Arrangement provider pays the IVA at say 20 pence in the pound, then Council Tax and the Council make a profit on the deal! That is not the idea!

This falls into the “nice try” basket….the BFI (Benefits Fraud Inspectorate) would definitely have called it a scam and fraud by the Council and would have probably called the police in to investigate this “conspiracy” by Council Tax and Benefits. As they did on many instances by various Councils. That takes me back remembering the various “Help” emails I got from Heads of Benefits.

Fortunately the BFI is long since defunct so I would put this down to a misunderstanding by CT!