Decision Maker: Cabinet Member for Finance and Resources
Decision status: Recommendations Approved
Is Key decision?: No
Is subject to call in?: Yes
To allow the Council to write off the uncollectable sum of non-domestic rates debt following specialist legal advice.
That approval is given to write off £74,378.14 in uncollectable non-domestic rates in accordance with the Council’s Financial Regulations.
The sums, detailed below, have become irrecoverable.
Address: 26/27 Isaac Newton Centre
On 11 June 2019 the company entered into a Corporate Voluntary Arrangement (CVA) which had been approved by the requisite 75% of its creditors. The effect of the CVA is to render the debt irrecoverable.
Address: Offices and Premises
The sum in question represents 50% of the non-domestic rates due. Due to legal complexities, the Council took specialist legal advice, as a result of which the Council agreed to accept 50% of the liability (which has been paid). The Council could have attempted High Court debt recovery action for the full amount, but would have been at risk of a substantial costs order should recovery of the full amount have been unsuccessful. The debt detailed here is therefore the remaining 50%.
In respect of the first debt, the Council would stand no reasonable chance of recovering its debt. In respect of the second debt, the Council has taken independent legal advice from a barrister, and the write off is recommended due to the legal risks of litigation.
All attempts have been made to recover the outstanding sums and there is no alternative but to recommend the first debt is written off and in respect of the second, the Council has followed legal advice. From a financing perspective and due to the funding mechanism of the business rates, 40% of the debt will be met by the Council with the remaining 60% shared between the Government and Lincolnshire County Council on a 50:10 basis.
Publication date: 18/03/2020
Date of decision: 17/03/2020
Effective from: 26/03/2020