Worried about direct debit payments unexpectedly going through the roof?
Here’s a handy hint courtesy of a reader whose quick-thinking prevented a huge payment from going out of his account.
Jordan Sach told me how Newcastle Council took a lump sum of £725.
Jordan reversed the payment, which was for council tax, in the nick of time by making use of a direct debit indemnity.
The indemnity is a system to claim back some payments including incidents where the customer has not been given enough notice.
Jordan said: “Newcastle City Council took money from my account.
“It was a large amount and it pushed me into overdraft and left me in real danger of being unable to afford my rent.
“I luckily managed to just block it in time through my bank using Direct Debit Indemnity.
“But when speaking to the council I couldn’t believe how unhelpful or remorseless they were, they didn’t seem to think it was a problem.”
“Not only should the council be exposed for such outrageous practices but I feel it’s also important people are made aware they can block payments such as this using the indemnity.”
Direct debit indemnity is a way of claiming back some direct debits.
This includes instances where you have not been given the required advance notice regarding a change of amount or date, or if you have been debited an incorrect amount, earlier than the agreed date or in error.
We asked the council for their point of view.
They said Jordan and his partner had not told them of a change in circumstances that affected their rights to a reduction in council tax.
A council spokesman confirmed they had wanted the bill paid in one instalment.
He said: “If they had contacted us before we acted, to say they could not afford to pay in one instalment we would have been more than happy to negotiate a plan with them which would have made it easier for them - but they did not.
“We collect millions of pounds in council tax through direct debit every year, and rely on residents to contact us if they are unable to pay.
“We were unaware of their circumstances and unable to act once the direct debit had been taken. They have exercised their right to claim back the direct debit”
The council said they had now suggested a payment plan.
The spokesman said: “In these situations, we always try to find a resolution that is acceptable to the other party, but we do rely on them talking to us in good time so we can avoid these situations.”