Shetland Islands Council Tax Debt Help

Struggling With Shetland Islands Council Tax?

Shetland is the most northerly part of Scotland, a chain of islands stretching from Sumburgh Head on the Mainland up through Yell to Unst, with Whalsay, Bressay and the smaller isles linked by ferry. Lerwick is the main town and the council’s base. Council tax here is below the Scottish average, but bills rose by 7.3% for 2026-27, and with island living costs high, falling behind is easily done. Wherever you live in the islands, the way council tax is billed and collected is the same, and if you have fallen behind, there are clear ways out. This page explains how the council operates, how arrears are recovered, and how to get a debt back under control before it reaches a wage arrestment.

How we can help:

• We deal with the council and its sheriff officers for you
• We help you agree a realistic, affordable payment plan
• We set out every debt solution open to Shetland residents
• We can help stop or avoid a wage arrestment
• Free, confidential help with no obligation

Watch: how council tax recovery and sheriff action works in Scotland, and how to stop it.

About Shetland Islands Council

Shetland Islands Council is the unitary local authority for Shetland, one of Scotland’s 32 councils and one of its three island councils. It serves 22,710 people, according to the National Records of Scotland estimate for mid-2025. Lerwick is the main town, and the council’s headquarters is at 8 North Ness Business Park, Lerwick, ZE1 0LZ, with a main switchboard on 01595 693535.

Council tax and business rates are billed and collected by the council’s Revenues and Benefits team in Finance Services, which also handles discounts, Council Tax Reduction and the recovery of arrears. The valuation band on your home is set by the Assessor for the Orkney and Shetland Valuation Joint Board, not by the council. The council’s 2026-27 leaflet shows council tax raises just 7% of its budget, while 24% comes from the return on its own investments.

Shetland council tax contact details

These are the council’s main contact points for council tax. If you are worried about paying, the council asks you to contact it immediately, before you miss an instalment.

You can pay online, by Direct Debit, by card over the phone, by cheque by post, or with an Allpay swipe card at any Post Office or PayPoint outlet, which you can request by emailing the council. If ringing the council yourself feels difficult, we can speak to the council for you and help set up an arrangement.

Council tax in Shetland

Council tax is an annual charge on domestic property, set each year by Shetland Islands Council. What you pay depends on the valuation band of your home, which reflects its value on 1 April 1991. Your bill also includes water and sewerage charges, which are set by Scottish Water and collected with your council tax. The council keeps none of that money.

Bills are issued in spring for the year that begins on 1 April. If you want to understand the wider system, who is liable and how billing works, see our guides to council tax in Scotland, council tax liability and billing and collection.

Shetland council tax bands and charges 2026-27

For 2026-27, Shetland Islands Council increased council tax by 7.3%, taking the Band D council tax to £1,487.90, up from £1,387 in 2025-26. The council’s leaflet puts the Scottish average Band D for 2026-27 at £1,662, so Shetland remains well below it. The table shows the council tax and the full bill with Scottish Water’s charges added.

If you think your home is in the wrong band, you can check it on the Scottish Assessors website and, in limited circumstances, ask for a review, though a review can move a band up as well as down. Our council tax valuation guide explains how bands and challenges work.

Reductions, discounts and second homes

Even with bills below the Scottish average, make sure yours is as low as it should be: the right reduction can make catching up far easier.

• Council Tax Reduction (CTR): a means-tested reduction for people on a low income. Savings over £16,000 rule you out unless you get Pension Credit Guarantee Credit. If you get Universal Credit, you still need to make a separate claim to the council. The benefits team is on 01595 744682 or benefits@shetland.gov.uk.
• Single person discount (25%): if you are the only adult in the property, you get 25% off the whole bill, including water and sewerage.
• Disabled band relief: if a resident needs an extra room, an additional kitchen or bathroom, or space to use a wheelchair indoors, the home is charged one band lower. Band A homes that qualify pay a reduced council tax charge of £826.61. See our disabled band reduction guide.
• Other discounts and exemptions: students, apprentices, carers and people with a severe mental impairment can be disregarded, and some properties are exempt. Our council tax discounts guide explains who qualifies.

Shetland has used its powers on second and empty homes. Since 1 April 2024 a second home has paid a 100% supplement, so 200% of the normal charge. Homes empty for more than a year pay a long-term empty supplement that councillors agreed in February 2024 to phase in: 175% of the normal charge in 2026-27, rising to 200% in 2027-28. Homes marketed for sale or let are exempt for up to two years, and the council can extend this where a sale is held up by issues such as de-crofting or boundaries. If you are being charged a supplement you do not think applies, raise it with the council straight away, and see our guide to empty dwellings.

Business rates in Shetland

Business rates, or non-domestic rates, are the commercial equivalent of council tax and are billed by Shetland Islands Council. The poundage is set nationally by the Scottish Government, and your bill is the rateable value of your premises, set by the Assessor, multiplied by the poundage.

For 2026-27 the Scottish Government set three rates:

Many smaller Shetland businesses pay little or nothing through the Small Business Bonus Scheme, which can give 100% relief on a single property with a rateable value up to £12,000, with tapered relief up to £20,000. Other reliefs, including charity, rural and Fresh Start relief, may also apply, and the council publishes its own Empty Property Relief Policy. Unpaid rates are recovered like council tax, through a summary warrant that adds 10% and enforcement by sheriff officers.

Which sheriff officers does the council use?

When council tax or business rates go unpaid and a summary warrant has been granted, Shetland Islands Council can pass the account to sheriff officers. Its own guidance says sheriff officers have the power to arrest bank accounts or wages if payment is not made. Sheriff officers are officers of the court, not private bailiffs, and their powers are set by Scottish law.

The council does not name its sheriff officer firm on its public pages, and we have not found a procurement notice that shows it. Whichever firm it uses will hold a court commission covering the sheriffdom of Grampian, Highland and Islands, and will act through Lerwick Sheriff Court on King Erik Street, which covers the Shetland Islands. What matters more than the firm’s name is how you respond: the same rules and protections apply as with any sheriff officer in Scotland, and the firm’s name will be on any letter you receive.

If a sheriff officer has contacted you about a Shetland debt, see how sheriff officers work, what they can and cannot do, and every firm that acts for Scottish councils on our sheriff officers and council tax hub. We can also deal with them for you.

What happens if you fall behind in Shetland

Shetland sets out its recovery stages on its own website. Knowing them helps you see where you are and how much room you still have to act.

1. First reminder. Miss an instalment and the council sends a reminder. If you do not pay within 7 days, you lose the right to pay by instalments, the full year becomes due and a final notice follows.
2. Second reminder. If you catch up but miss another payment in the same year, a second reminder is issued. Fall behind again, or a third time in the year, and you lose the right to instalments.
3. Final notice. The full balance becomes due. If you cannot pay it, the council asks you to call 01595 744683 to agree an affordable instalment arrangement.
4. Summary warrant. If the final notice is not paid, the council obtains a summary warrant from Lerwick Sheriff Court, granted without a hearing, and an extra 10% is added.
5. Sheriff officer enforcement. Sheriff officers can serve a charge for payment giving you 14 days, then arrest wages or a bank account.

Before an earnings arrestment you must be given a debt advice and information package, and deductions follow statutory tables, as our guide to how much can be taken from your wages explains. With a bank arrestment, the first £1,000 is protected. You can offer payment at any stage, yourself or through us.

What to do if the council contacts you about arrears

Whether the letter comes from the council or from a sheriff officer, the sensible steps are the same.

1. Open it and act. Council tax arrears do not go away, and ignoring letters only moves the debt further along the recovery process.
2. Check it is right. Make sure the debt is yours, for the correct property and year, and that any discount, exemption or Council Tax Reduction you are due has been applied.
3. Ask for identification. A genuine sheriff officer carries a formal identity document, and you are entitled to see it before you deal with them.
4. Do not overcommit. Only agree to what you can genuinely afford, because a broken arrangement usually leads straight to a wage arrestment.
5. Get advice and set up a plan. A realistic arrangement, the Debt Arrangement Scheme or another solution is what actually stops enforcement.

If dealing with the council or a sheriff officer feels overwhelming, we can take it on for you with your permission and help you reach something affordable.

Solutions if you are struggling with Shetland council tax debt

The most effective way to deal with sheriff officers is to resolve the arrears behind the enforcement. Depending on your circumstances, the main routes for Shetland residents are:

• Special payment arrangement: an affordable plan agreed with the council, which decides whether to accept it.
• Debt Arrangement Scheme: approval of a Debt Payment Programme recalls an earnings arrestment.
• Trust deed: a protected trust deed ends an arrestment from the date of protection.

Not sure which fits your situation? See our wage arrestment solutions overview, or get in touch and we will talk it through, free and with no obligation.

Free debt advice in Shetland

Alongside our service, free advice is available in the islands. You never need to pay for good council tax debt advice.

• Shetland Islands Citizens Advice Bureau: free, confidential and independent advice on debt, benefits and energy bills, at Market House, 14 Market Street, Lerwick, ZE1 0JP, on 01595 694696 or 01595 696776, or sicab@shetland.org.
• National Debtline: free confidential telephone debt advice, on 0808 808 4000.
• StepChange Debt Charity: free national debt advice, on 0800 138 1111.

These services are independent and free. We work alongside this kind of support and can help you take the practical steps that stop enforcement.

Shetland Islands Council at a glance

Where to find free, impartial information

As well as speaking to us, you can check your rights with these independent, official sources:

• Shetland Islands Council: Council Tax
• mygov.scot: Council Tax (Scottish Government)
• mygov.scot: Sheriff officer powers and your rights
• Citizens Advice Scotland: Debt and money
• mygov.scot: Non-domestic rates guidance

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