Getting it straight

Council Tax Attachment of Earnings

There has recently been a certain amount of confusion relating to Council Tax Attachment of Earnings Order calculations. Much of this misunderstanding has been initiated by local authorities on the operation of new tables which were introduced for new orders issued from 1st April 2007.

Some councils, employees and/or employers assume that the new tables are operational for all pre-existing CTAEO cases. However, unlike Scottish law, English/Welsh law is rarely retrospective, and is not retrospective in the case of CTAEO.

So what is the difference?

Council Tax Attachment of Earnings Order calculations need to be kept currentIn Scotland, when new tables are introduced - often at very short notice - the new tables apply (when practical) to both new and pre-existing arrestments across the board.

In England and Wales, new tables only apply to new orders. Older dated orders always calculate on the tables applicable at the issue date of that order. This is even the case if the order were to be added to the payroll after the date on which the new tables come into force.

For example, a CTAEO issued on 15 March 2007 by Anglia Council but not applied to the payroll until 15 April 2007 due to postal and administrative delay, must and will be calculated in Ceridian Payroll using the pre-1 April 2007 Council Tax AEO Tables as the issue date is 15 March 2007.

A CTAEO issued on 5 April 2007 by Anglia Council but not applied to the payroll until 15 April 2007 must and will be calculated in Ceridian Payroll using the post-1 April 2007 Council Tax AEO Tables.

The determination of the correct CTAEO tables to be used is automatically made on the data entered for the order and the associated issue date.

Orders issued before 1 April 2007

It is evident from examples provided that some councils have issued orders with an issue date before 1 April 2007 but asked the employer not to apply the order in the payroll process until after 1 April 2007, assuming that the individual will benefit from the new tables. This is an abuse and will not work. It may fool less capable payroll systems in the marketplace, but Ceridian Payroll operates rich validation and automation rules which this incorrect assumption will not work with.

Councils cannot pre-date orders in this way. If the issue date from the council states a pre-1 April 2007 date, then the order will be calculated on the former tables. If that is not their intention, then they need to re-issue a correct replacement CTAEO on a date on or after 1 April 2007.

Note that the new tables are not to be operated for the payment of Magistrate Fines regardless of date.

If you are a Ceridian client, and require further support, please contact your Ceridian advisor.

If you are not a Ceridian client, and have found this information helpful, contact us for more information on the services and advice we provide.

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