Tower Hamlets keeps £7.5m in unclaimed council tax

Laurence Prax discovered that the council has �7.5million in unclaimed council tax rebates. Picture:

Laurence Prax discovered that the council has �7.5million in unclaimed council tax rebates. Picture: LAURENCE PRAX - Credit: Archant

Tower Hamlets has £7.5million sitting in 68,000 closed council tax accounts.

When Laurence Prax moved from his flat in Plumbers Row, Whitechapel to West Hampstead last September the local authority wrote telling him if he wanted money left in his council tax account refunded he had to post back a form.

Mr Prax said: “I thought this was ridiculous given the ease of simply returning the credit to the bank account it came from.

“I realised there must be a huge amount of closed accounts still in credit because people couldn’t be bothered to go through the paperwork or were unaware.”

Tower Hamlets responded to the 28-year-old tech company director’s freedom of information request (FOI) saying it was holding onto £7,525,620 left in 68,250 dormant council tax accounts.

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He accused Tower Hamlets of not making an effort to let people know they were owed money.

Mr Prax said the council should give people simpler ways to get their money especially given the high levels of poverty and different languages spoken in the borough.

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“The council could be making it hard to claim.

“I would urge people [who have left the borough] to get in contact with them as soon as possible to make sure they aren’t owed money,” Mr Prax added.

But he said if the council had exhausted all avenues trying to return owed money, then what was left should be spent on the borough not left sitting in a bank account.

A Tower Hamlets spokesman said the council felt its current procedure for claiming back council tax was not onerous but the authority had to minimise fraudulent activity.

The oldest account goes back to 2000, it confirmed.

“The procedure is to send a bill upon account closure detailing the credit due and advising of the refund process. Where claimed, refunds are processed as a priority.

“Due to resource restrictions it is not practical to investigate further should the credit not be claimed but a new self-service digital process will be available early in the next financial year,” the spokesman said.

He added the council could look into using unclaimed money to tackle issues.

Unpaid refunds remain in the authority’s council tax accounts but Tower Hamlets expects to pay some of it back “in due course”, he said.

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