Summary: Mr X complained that the Council incorrectly issued a council tax refund to Mrs Y when she requested this after Mrs Y moved out of their shared property. The Council issued the refund in line with the relevant law and policies without fault.

The complaint

1. Mr X complained that the Council incorrectly issued a council tax refund to Mrs Y when she requested this after Mrs Y moved out of their shared property. Mr X says this has caused distress, frustration and financial uncertainty as the Council has said Mr X is liable to pay this money and increased his council tax bill.

Back to top

The Ombudsman’s role and powers

2. We investigate complaints of injustice caused by ‘maladministration’ and ‘service failure’. I have used the word fault to refer to these. We consider whether there was fault in the way an organisation made its decision. If there was no fault in how the organisation made its decision, we cannot question the outcome. (Local Government Act 1974, section 34(3), as amended)
3. 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

How I considered this complaint

4. I considered evidence provided by Mr X and the Council as well as relevant law, policy and guidance.
5. Mr X and the Council had an opportunity to comment on my draft decision. I considered any comments before making a final decision.

Back to top

What I found

Relevant law and guidance

6. Council Tax is a tax on domestic property which was introduced by the Local Government Finance Act (LGFA) 1992.
7. The LGFA Act (Section 6(2)) sets out the hierarchy of liability for each chargeable dwelling. Section 6(4) says joint freeholders, leaseholders, tenants, licensees, squatters and owners – are jointly and severally liable. In addition married couples, civil partners and people living together as man/woman and wife/husband are also jointly and severally liable. This means each of them are each responsible for paying the whole charge. If one leaves and the joint bill is unpaid a council can pursue either of them for the remaining debt.

The Council’s council tax policy

8. On the Council’s website and on the council tax bills it sends out, it advises a person should notify the Council straight away about a move or change in circumstance, so a household is paying the right amount of council tax.
9. The Council’s refund procedure says the following:
• To avoid the possibility of fraud, the Council should exercise caution when issuing refund cheques to an address no longer occupied by the recipient. Ideally this should be avoided.
• As a general principle where bank details are available and it is appropriate to use them, the Council should make refunds using the BACS system.

What happened

10. Mr X and Mrs Y are a married couple who lived together in a property they own. They had a joint council tax account which they paid from a joint bank account.
11. Mr X and Mrs Y separated and Mrs Y moved out of the property in early 2022. Mr X did not notify the Council of a change in circumstances and council tax continued to be paid from the joint bank account.
12. In February 2024, Mrs Y contacted the Council to notify it she had moved out of the property over two years prior. She informed the Council Mr X remained living there. The Council therefore ended the joint account which created a credit on the account of around £3500. It created a new account in Mr X’s name only. The Council advised Mrs Y of the credit on the joint council tax account. It said it could refund the money back to the account it was paid from. It said it could not refund this money to a different bank account without signed authority of all named parties.
13. Mrs Y responded a few days later and told the Council, due to the circumstances, it was not possible to get Mr X’s signature to refund the money.
14. The Council then did the following between February and June 2024:
• In February 2024 the Council set up a new council tax account in Mr X’s name and issued him with a new revised bill for the amount due between January 2022 and March 2024.
• In March 2024 it issued Mr X with a council tax bill for the new financial year.
• In April and May 2024 the Council sent reminders to Mr X for the outstanding amount of council tax owed between January 2022 and March 2024.
• In June 2024, the Council sent a final notice to Mr X for the outstanding amount, plus a reminder for the council tax due for the current financial year.
15. As the Council did not receive any contact from Mr X after closing the joint account and issuing the revised bill and reminders, the Council decided to issue the refund into the joint bank account which was used to pay the council tax.
16. In November 2024, Mr X raised a stage one complaint. He advised he was currently in council tax arrears of over £3500 due to the Council making a refund of £3500 into his joint account in June 2024. Mr X said he had no idea Mrs Y had requested a refund and she moved this money out of the joint account the day after the Council issued the refund. Mr X said the Council should have never issued the refund as she left in January 2022 and since then Mr X has paid the council tax out of his own money.
17. In December 2024 the Council issued a stage one response saying it had acted in line with its procedures. The Council said it has authority to refund payments from their origin of source so when the refund was requested it issued this to the account where the direct debits were made from. It said it was not for the Council to intervene, where an account is held in joint names, regarding what happens to a payment following a refund.
18. The same month Mr X escalated the complaint to stage two. The Council issued a stage two response reiterating what it said at stage one.
19. Mr X remained dissatisfied with the matter and complained to us.

Council’s response to our enquiries

20. The Council said as it had not received any contact from Mr X after sending him the revised bill, and because of the contact it had from Mrs Y regarding the refund, it decided to refund the amount to the joint account from where the direct debits came from. The Council said it had no indication who had access to the account and the funds within this, as it was a joint account. It said it was not for the Council to investigate these matters further.

My findings

21. It is documented on both the Council’s website and every council tax bill sent to Mr X to notify the Council of any change of circumstances to ensure households are paying the correct amount of council tax. When Mrs Y left the house in January 2022, it was the responsibility of the household to notify the Council of this change. In February 2024, after Mrs Y requested the refund, the Council opened a new council tax account in Mr X’s name, sent him a revised bill and several reminders about this over four months. Mr X did not respond or query the increased bill and therefore, the Council decided to issue the refund. It issued this back to the joint bank account the payments were made from which both Mr X and Mrs Y had access to. The Council issued the refund in line with its policy and without fault.
22. If Mr X believes Mrs Y has fraudulently claimed this refund, that is a matter between him and Mrs Y, not the Council.

Back to top

Decision

I find no fault.

Investigator’s decision on behalf of the Ombudsman

Back to top

Investigator's decision on behalf of the Ombudsman