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Council Tax insolvency and charging orders

What happens if we take bankruptcy or liquidation proceedings against you.

Insolvency

If you or your company owe more than £5,000 in Council Tax or Business Rates, and you have been summonsed, we may start bankruptcy or liquidation proceedings against you.

If we take this action, we will pass your account to a solicitor who will send you a statutory demand. A statutory demand gives you 21 days to pay us the full amount.

If you receive a statutory demand, you should contact the solicitor immediately.

If you do not settle the statutory demand, we will present a petition for bankruptcy or liquidation in the County Court. 

Charging order

If you owe us over £1000 in Council Tax or Business Rates, we can choose to apply for a charging order.

A charging order can only be applied for where the liable party has a beneficial interest in the property, for example is the owner or part owner.

If a charging order is granted it gives the council a charge on the property which means once the property is sold and any mortgage paid off, the Council Tax debt can be claimed from any remaining equity. It may be possible for the council to enforce the sale of the property.

We can still help you at this stage. Please contact us to discuss your debt.


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© 2026 North Yorkshire Council

The council provides services across North Yorkshire including Harrogate, Ripon, Scarborough, Whitby, Northallerton, Thirsk, Selby, Tadcaster, Malton, Pickering, Richmond, Skipton and more.

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