Manchester City Council (20 002 642)

Category : Benefits and tax > Other

Decision : Not upheld

Decision date : 05 Jan 2021

The Ombudsman's final decision:

Summary: There was no fault in how the Council processed a refund for overpaid business rates. We have therefore completed our investigation.

The complaint

  1. The complainant, to whom I will refer as Mr J, says the Council paid a refund of business rates into the wrong account.

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The Ombudsman’s role and powers

  1. We investigate complaints about ‘maladministration’ and ‘service failure’. In this statement, I have used the word ‘fault’ to refer to these. If we are satisfied with a council’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)

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How I considered this complaint

  1. I reviewed Mr J’s correspondence with the Council, a copy of his company’s bank statement, and the Council own records of the business rates payments it received and the refund it made.
  2. I also shared a draft copy of this decision with each party for their comments.

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What I found

  1. Mr J is the director of a business. The company had been paying business rates on its accommodation; but in March 2020, it successfully applied for small business rates relief. The Council agreed to refund the business rates it had been paying since March 2018, a total of £1553.60.
  2. In July 2020, Mr J contacted the Council to chase up the refund. The Council responded to confirm it had paid the refund on 17 June. It gave the account number and sort code of the account it had paid the refund into, partly redacted.
  3. Mr J replied to say this account had nothing to do with the company. He gave a different account number and sort code, and urged the Council to check this against its records. Mr J said the Council had paid the refund to the wrong person, and asked the Council to deal with the matter as a complaint.
  4. The Council responded on 11 July. It said it had checked its records, and noted Mr J’s company had changed its name during the period it was paying business rates. However, the account details it received the payments from were the same under both names, and confirmed the details matched those into which it paid the refund. The Council explained it was its policy to pay refunds into the sending account, to help tackle possible fraudulent claims.
  5. The Council asked Mr J to check the details again, and to submit any evidence he might have which could allow it to investigate further.
  6. Mr J submitted a further complaint on 17 July. The Council replied on 30 July. It acknowledged Mr J had sent it documents to support the complaint, but declined to investigate further, as the Council had checked its own records again and confirmed it had paid the refund into the same account it had received it from.
  7. Mr J referred his complaint to the Ombudsman on the same date.

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Analysis

  1. Mr J says the Council has paid the refund into the wrong account. The Council says it has paid the refund into the same account it received the payments from, and it is policy to do this in order to prevent fraud.
  2. Mr J has provided us with a copy of the business’s bank statements from March 2018 (covering the first payment) and January 2020 (covering the last). Both payments are from the same account – to which I will refer as Account 1 – and are labelled with a reference number.
  3. The Council has provided me with screenshots from its system, showing the receipt of payments. The reference number is the same as on the bank statements, and the payment dates and amounts for the March 2018 and January 2020 instalments also match those on the bank statements.
  4. However, the Council’s records show the payments were received from an account with a different account number and sort code – to which I will refer as Account 2.
  5. The Council has also provided me a screenshot showing it processing the refund. It paid this into Account 2. These are also the details it provided Mr J during the complaints process.
  6. I cannot resolve this conflict. I have no reason to doubt the evidence provided by Mr J, which shows the business rates payments came from Account 1. But equally, I have no reason to doubt the evidence provided by the Council, which shows the payments came from Account 2. The Council is entitled to set its policy to refund only to the sending account, and so there is nothing to criticise here – the Council has applied its policy correctly.
  7. I appreciate this leaves Mr J’s business without the refund it is owed, for reasons which remain a mystery. But I could recommend the Council pay the refund again if I found fault in how it had processed it. For the reasons given, I have no such fault, and so I cannot uphold Mr J’s complaint.

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Final decision

  1. I have completed my investigation with a finding of no fault.

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Investigator's decision on behalf of the Ombudsman

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