The money-saving guru has been battling against what he termed ‘vicious and damaging’ practices
Martin Lewis revealed this morning that the government has implemented a crucial amendment to a ‘three week’ regulation concerning council tax. The money-saving guru has been battling against what he termed ‘vicious and damaging’ debt recovery practices whereby residents facing payment difficulties could be compelled to settle an entire year’s worth immediately – or confront bailiffs and legal proceedings – with additional charges piled on.
From April this will alter – and residents will receive more time than the 3 weeks numerous councils presently allow for payment. Authorities will now need to wait two months and extra administrative fees will be limited.
Mr Lewis stated: “Council Tax debt collection is so aggressive it’d make banks blush. It’s the most vicious and damaging form of legal debt collection out there – causing counterproductive misery for millions. We’ve spent the last 18 months campaigning hard to change this hideous system, and having seen so much pain caused by it, I’m genuinely moved by this huge first step towards making things better.
“Currently, in England if you miss a monthly payment, many councils, within usually 3 weeks, demand payment for the entire year. How people who can’t find a month’s money are expected to find a year’s I don’t know. Yet if they can’t pay, within just three more weeks, they are often taken to court, have ‘admin costs’ added, and soon see bailiffs sent in. No commercial firm would be allowed to do anything close – constituents are treated worse than customers.
“The new rule from next April means councils must wait two months, not 3 weeks, to ask for a year’s money, and the ‘admin costs’ will be capped at £100. In a perfect world, it would be even longer and the lower cap would apply, but this is still a hugely welcome change to a 33-year-old process. For councils too, it is worth remembering that this grotesque system is often catastrophic for people’s finances and wellbeing, leaving many needing more help and support, and ultimately the same council having to pick up the pieces.”
The announcement follows the Government’s publication today (Wednesday 15 April) of findings from its comprehensive review of the English Council Tax system, which was launched in June 2025.
Ministers confirmed today (April 15) that alterations will be implemented to how bills are administered, which have remained unaltered since 1993 and have become obsolete, causing residents to endure needless stress and worry.
The existing framework means that missing a single monthly payment can result in financial devastation, as residents become responsible for paying the entire outstanding amount in one lump sum just two weeks afterwards.
This will be transformed from next year, with households granted 63 days, approximately two months, to clear their bill and an obligation for councils to collaborate with them on a viable repayment scheme. Council tax billing will also switch to 12-month payments as standard, moving away from the existing 10-month system, while capping the fees councils can impose when pursuing a liability order – the mechanism councils use to recover outstanding bills – at £100.
Local Government Secretary Steve Reed said: “Too many families are facing aggressive enforcement action, with people left terrified of bailiffs knocking on the door because one month’s council tax bill was missed.”
Minister for Local Government Alison McGovern said: “We will stop this and make the system fairer by supporting families who fall behind. I want to thank Martin Lewis and his charity for their tireless campaigning, shining a light on this crucial issue affecting millions of people.
“We know the way council tax is run is outdated and confusing and has stopped some of the most vulnerable people from accessing the support they need. Our changes will cut through the complexity and make sure that council tax is fit for the 21st century.”
Payments for council tax will be automatically shifted to 12 months by default, but households who continue to wish to pay over 10 months will be able to do so. It means struggling households will be able to spread the annual cost across a longer period.
The government will also update the name and definition of the Severely Mentally Impaired council tax discount when parliamentary time allows, removing the stigma that puts off vulnerable people from seeking the support they are entitled to. Work will be undertaken in partnership with disability charities and local authorities to design a standardised application form and reduce barriers to make the process clearer and improve access to this support.
These reforms build on the wider changes the government has taken to fix the foundations of local government, so that it can once again be an engine of growth This programme on local government reform will ensure that local people can continue to benefit from high quality services.
This includes introducing the first multi-year financial settlement in a decade, giving councils the certainty they need to plan ahead and transform services, with a 24.3% increase in Core Spending Power for local authorities and nine in ten councils receiving funding that broadly matches their need – up from three in ten, with the government ensuring taxpayers are getting value for money and better services.