Thankfully, you don’t have to worry about council tax arrears affecting your credit score at all. Local councils don’t report any data to credit reference agencies. However, not paying your council tax will ultimately lead to fines and court action.
No, whether you pay your council tax late or on time, it won’t appear on your credit report.
No. There’s no way of lenders knowing that you’re in council tax arrears. Even if the debt is referred to court, this would be dealt with by the magistrates’ court, because non-payment of tax is regarded as a criminal matter, not a civil matter.
No fines imposed by a magistrates’ court appear on your credit report. They’ll impact your chances of getting a loan indirectly – by reducing your overall wealth.
Following confusion with his tenancy agreement, John discovered that he owed almost a year’s worth of council tax.
He thought it couldn’t have been worse timing, as he was just about to apply for a mortgage.
Luckily, after some research he realised that council tax arrears have no impact on his credit score, and he still had enough savings to fund a mortgage deposit.
* This is a fictional, but realistic, example.
It’s important to pay your council tax on time, or you might suffer fines for late payment. Missing council tax payments won’t impact your credit score though.
| Response | 55+ | 45-54 | 35-44 | 25-34 | 16-24 |
|---|---|---|---|---|---|
| Very important | 42.11% | 41.52% | 44.92% | 52.17% | 40.78% |
| Quite important | 39.06% | 43.27% | 38.14% | 34.16% | 34.95% |
| Not that important | 9.42% | 8.77% | 12.29% | 7.45% | 15.53% |
| Not important at all | 5.54% | 3.51% | 2.12% | 2.48% | 2.91% |
| I don't know what a credit score is | 3.88% | 2.92% | 2.54% | 3.73% | 5.83% |
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