Councils sit on tax cash paid by dead

Grieving families are owed at least £2.6 million in council tax overpaid by dead relatives.

A Sunday Post investigation has discovered millions in stockpiled cash waiting to be claimed.

The money mountain has spawned from householders continuing to pay the tax by direct debit after passing away.

The cash is supposed to be refunded to the deceased’s family within weeks of the death.

But often councils struggle to find the right people to send it to meaning it ends up gathering dust in council vaults.

Matthew Elliott, of the Taxpayers’ Alliance, said: “Council tax is one of the most unfair taxes we have, which imposes a burden on taxpayers with no regard to their income.

“Councils should return all the money that belongs to these people overpaid by deceased residents.”

Twenty-four of Scotland’s 32 councils confirmed they have council tax overpaid by the deceased awaiting transfer to next of kin.

The combined balance currently sits at £2.6 million. However, with seven local authorities unable to provide details of monies owed, estimates suggest council coffers could contain a further £1.8m for families of the dead.

Glasgow City Council has £643,000 stockpiled in the bank, while relatives of former North Lanarkshire residents are owed £620,000. Perth and Kinross Council has £252,000 in their coffers with Renfrewshire Council sitting on just under £300,000.

A council insider said: “Any overpayment of council tax should be notified to the executor of the dead person’s estate. However, it is often the case that no forwarding address has been provided or is available.”

Councils have also been known to chase the families of dead people who underpaid their council tax.

Paisley man Roy Elias, 69, was posted a bill from Renfrewshire Council after they claimed his 88-year-old mother Sarah who had passed away five weeks earlier owed 1p.

He lambasted authorities for failing to do their bit when the shoe is on the other foot.

Roy said: “It’s shocking that these councils are sitting on all that money especially when they chased me for a penny.

“My situation was a complete farce. It must have cost Renfrewshire Council £20, if not more, to demand 1p.

“I don’t see why those people who are due this overpaid tax shouldn’t now hound their councils to get the money back.

“If they chased me for a penny, then this money has to be given back to the people who are owed it. If nobody is claiming it, then the council are going to sit on it or use it one of the two.

“That is ridiculous when it’s other people’s money.”

Susan McPhee, of Citizens Advice Scotland, said: “Bereavement is a very difficult time, and there are so many things to think about and deal with when you are already likely to be in a fragile emotional state.

“Reclaiming council tax that has been paid in advance by your relative is not going to be something that is necessarily at the top of your list of priorities, but support and help with this is available.”