Lost in the system report launched

The Money Advice Trust published a report on the council tax system in England in February 2026, titled Lost in the system¹. The charity says the system "isn't working well for either people in debt, or for councils", and that with arrears continuing to rise to record levels there is "a clear argument for a new approach"¹. The report sets out recommendations to the Government and local authorities intended to help ensure council tax regulations do not cause harm to financially vulnerable households¹.

The findings include that half (49%) of adults in England have not heard of Local Council Tax Support, also called Council Tax Reduction¹. People receiving Universal Credit are five times more likely to have missed a council tax payment in the last 12 months¹. Three quarters (74%) of people made liable for their annual bill said they fell behind on other household bills in order to make their payments to the council¹.

The Trust states that its findings show good practice and support is not widespread enough¹. Separately, the same page records that arrears levels reached a record breaking £4.4 billion in England alone¹. The page does not date that arrears figure, and it is not attributed to the Lost in the system report specifically.

The Trust describes itself as "committed to a programme of research which enhances understanding of the debt and credit environment and practically improves money advice"¹. Its research is carried out with academic institutions across the UK and managed by its Insight team¹.

Why it matters for households

Council tax is a bill every liable household in England has to pay, and the report concerns how the system treats people who fall behind. The findings point to two groups in particular: adults who are unaware of Local Council Tax Support, the reduction scheme that can cut a council tax bill, and households on Universal Credit, who the research links to a higher likelihood of a missed payment¹. The report also records that a majority of people made liable for their annual bill said they fell behind on other household bills in order to keep up council tax payments¹, which describes money being moved between essential outgoings rather than a single missed payment.

The report's recommendations are addressed to the Government and to local authorities, so any change to regulations or to collection practice would come from those bodies rather than from the charity. The Trust has previously published material on local authority debt collection, including six steps for local authorities published in August 2024, which followed its Stop the Knock campaign¹. In 2022/23 local authorities in England and Wales issued more than 2.7 million referrals to bailiffs for debts, according to that publication¹.

For households, the practical questions raised are whether support schemes are known about and claimed, and how councils pursue arrears. The report does not itself change any tax rule, rate or relief, and no implementation date for its recommendations has been reported.

What happens next

No timetable for a response from the Government or from local authorities has been reported. The Trust has not said when, or whether, it will publish further findings on this work.