What is an Attachment to Earnings Order?
If a Liability Order has been granted against you, for unpaid Council Tax, there is a likelihood that you will be contacted with regards to an Attachment to Earnings Order. We believe it to be useful to know what’s going to happen, should your Local Authority decide to use this as the method of recovering the unpaid balance(s).
An Attachment to Earnings Order is a method used to recover unpaid Council Tax. This means your Local Authority can demand money from your salary before you receive it. It is implemented by way of a legal document that is sent direct to your employer.
Unpaid Council Tax is the most common route that will result in an Attachment to Earnings Order. This reinforces the bill’s status as a priority debt.
Once your Local Authority has issued the legal paperwork to your employer, it then becomes the responsibility of your employer to ensure the order is implemented. You will note, on your payslip, that this will appears as a deduction and taken from you in a similar way your tax, national insurance and pension contributions are. You’ll see the amount that’s been paid on your payslip.
What happens if I believe there to be an error?
Prior to an Attachment to Earnings Order being implemented, there is a multifaceted process that takes place therefore, the chances that an error will have occurred are limited.
That is not to say errors are impossible. If you genuinely believe there to be an Attachment to Earnings Order going through that shouldn’t be, contact your Local Authority’s Council Tax department as soon as possible!
How much will be deducted from my salary?
Deductions from your salary are dependent on how much you earn. An Attachment to Earnings Order cannot take anything if you earn less than £300 per month or £75 per week. Beyond that amount a percentage of your Net Salary will be deducted.
The following information will help you work out how much of your income will be deducted if you are monthly paid:
|Salary Exceeds||But Less Than||Percentage Deducted|
|£2,020.00||———||17% of the first £2,020.00 then 50% of the amount exceeding £2,020.00|
The following information will help you work out how much of your income will be deducted if you are weekly paid:
|Salary Exceeds||But Less Than||Percentage Deducted|
|£505.00||———||17% of the first £505.00 then 50% of the amount exceeding £505.00|
When will deductions start?
Your Local Authority will look to get the Attachment to Earnings Order implemented as quickly as possible so the unpaid bill is settled quickly. They will let you know when the first payment will come out – although you can ask them or your payroll department if you’re not sure.
Can the deduction amount change?
Yes. If you keep in mind that any increase to your income will also mean an increase to the deduction for the Attachment to Earnings Order.
This could be affected by:
What happens if I have time away from work due to illness?
If your sick leave is paid, then deductions will continue as normal. If the amount you take home is reduced (which would happen if you go on to statutory sick pay) then the deductions may reduce too.
If your earnings drop below the minimum amount for deductions, then check with your payroll department or the Local Authority involved and request that the order be put on hold until you return to work.
What happens if I go on maternity leave?
A Local Authority cannot take money away from statutory maternity pay – but they are able to do so if your employer is continuing to pay you a contractually agreed amount throughout this time.
If you are unsure how or what you’re going to be paid, it’s important to talk to your payroll department at the earliest opportunity.
Can I ask my employer to simply stop paying?
However tempting it may be, to ask your employer to simply stop deducting from your salary, it would be very unwise to do so.
For you: it will mean the arrears will still be there, and could become subject to alternative recovery methods – such as referring your arrears to Enforcement Agents, where further fees will be incurred, increasing your balance considerably.
For your employer: Attachment to Earnings Orders are not a “request” but a formal demand therefore, your employer is legally bound to abide by the order. Failure to do so can have great legal ramifications – especially for larger employers, where the consensus is that they would know better than to not adhere.
Can I make an arrangement instead of the Attachment to Earnings Order being implemented?
If an Attachment to Earnings Order has been granted, then unfortunately this is where things will stay, until the balance is cleared.
That said, there are some occupations where an Attachment to Earnings Order is inappropriate or prohibited:
- Serving member of the Armed Forces
- Merchant Seamen
- Police Officers*
*= Through our experience, Police Officers are forbidden to be in debt with Council Tax and being in arrears can be a disciplinary issue. If an Attachment to Earnings Order is applied for, it could result in loss of employment, which is not in the best interests of any involved party
If you do have an Attachment to Earnings Order against you, don’t worry, your details are held under strict data protection law by your employer and will only be viewed by people who need to know about your situation – which is usually only a payroll team.
What happens if I change employer?
If you move to a different place of work there can sometimes be a delay in information that relates to tax codes and PAYE (pay as you earn) deductions reaching your new employer.
To be sure that you’re staying within the law, you should let your new employer know about an Attachment to Earnings Order as quickly as possible, and update your Local Authority – so that they are aware, in case a delay does occur – and then they will know why.
If I am made redundant, will deductions be made from redundancy pay?
Redundancy Payments are exempt from Attachment to Earnings Order deductions however, if you are wise, you should consider contacting your Local Authority and using some of this money to reduce / clear your balance.
Can I avoid an Attachment to Earnings Order?
If you pay your Council Tax bill on time, and in accordance with your annual bill, then you will not find yourself facing this issue however, we recognise that falling into arrears is not totally avoidable therefore, dealing with any issues as soon as they arise is crucial.
If you have fallen into arrears previously, and had made a direct arrangement with your Local Authority that subsequently defaulted without you discussing the issue with them (change in circumstances etc..) then they could apply for the order as a result.
Most Attachment to Earnings Orders are granted because of a communication breakdown between the person paying towards a Council Tax debt and the Local Authority themselves. This is why it is really important that you stay as engaged as possible with your Local Authority – especially if there are changes to your circumstances.