Major council tax rule change for millions of households - check if you'll benefit

A huge council tax change is set to benefit millions of households from next April. The move will give struggling households more time to engage with local authorities over missed payments to prevent debt escalating.

The Welsh Government has confirmed the new rules will come into force from April 2026, with families allowed 63 days to address missed council tax payments. Under the current rules, households can be asked to pay for the entire year within three weeks of missing a monthly payment. The matter can then be taken to court if this isn't paid within six weeks. However, campaigners fought hard against the practice and the Welsh Government launched a consultation.

The consultation received over 250 responses from councils, members of the public and advice organisations, with the majority supporting an extension of the period before enforcement. Campaigners, including Martin Lewis, labelled the current council tax debt collection rules "vicious, aggressive and damaging".

According to the Welsh Government, the new rules will give families "crucial extra time to get support" while making sure councils still have the power to act against those who owe money. They added that it will "deliver a fairer council tax system while maintaining effective collection of funds for essential public services".

Finance Secretary Mark Drakeford said: "We're supporting councils to prevent rapid escalation of council tax debt, by giving more time for households to recover from unexpected setbacks, check eligibility for support, and get back on track.

"Anyone struggling to pay council tax should contact their council as soon as possible, or use the free advice services available through the Welsh Government's Claim What's Yours service."

Financial guru Martin Lewis added: "Council Tax debt collection is the most vicious, aggressive, damaging form of debt collection there is out there.

"We've spent the last year campaigning hard for this hideous system to change, and so I'm over-the-moon the Welsh government has listened, and Wales is going to take the lead on improving things."

In England, similar practices for council tax debt collection are in place. The Labour Government launched a consultation to change the process in May but the outcome has not yet been confirmed.

The plans proposed increasing the period councils have to wait before demanding a bill is paid in full. It also proposes a cap on costs charged to households through liability orders.