Test Valley Borough Council’s cabinet has approved wiping out £310,975 in unpaid business rates debts, accrued by businesses. Much of the uncollectable sum has been built up after five companies either went into liquidation, administration or dissolved. £26,282 belongs to an individual – who has not been named in the report – who went into bankruptcy.
A report to cabinet said “Professional advice was sought following the identification of this error that confirms there is little chance of any recovery if the amount owed is pursued through the courts.”
“It is inevitable that it will be necessary to write off certain amounts as uncollectable when businesses go into liquidation and have arrears owed to the council,”
Of the £310,000 worth of debts, the authority says that the actual cost to the authority is expected to be around £50,155. This is in part due to other organisations sharing the cost of the debt and amounts already provided from previous years’ accounts, along with reduced levy on business rates growth.
The report added “The total estimated business rates payable in 2018/19 was £56.35m. After allowing for amounts already taken into account in previous years, the amount recommended to be written off is 0.4 per cent of the total estimated income.”
