BOURNEMOUTH council has been accused of "hoarding" more than £700,000 in overpaid council tax - 10 times more than the amount held at neighbouring Poole.

A council audit revealed there are 10,384 accounts where people are owed refunds dating back to 1996 and two instances where people are owed more than £10,000 each.

There are 31 accounts with credit balances of between £1,000 and £10,000, 2,049 accounts with credits of between £100 and £1,000 and 8,302 accounts with credits of under £100.

On top of the £700,885 total, there is also one account with a credit balance of £118,994 where the council received too much money from the sale of a property and has not yet been able to trace the previous owner to issue a refund.

Campaign group the Taxpayers' Alliance has labelled the overpayments "totally inappropriate" and Bournemouth council has now asked its partner Mouchel, which collects council tax on its behalf, to make the issue a top priority.

In comparison, Poole is holding just £73,573 in council tax credits across 496 accounts. Only nine Poole accounts are more than £1,000 in credit and the largest credit is £2,736.

The issue of excessive credits in Bournemouth was first raised in 2013/14 and resulted in Mouchel agreeing to look at the issue every quarter and issue refunds where possible.

However a report presented to the council's audit and governance committee yesterday said that while new credits were now being properly dealt with, there was still a problem with significant credits dating back several years, mainly as a result of band changes or people moving away.

Ian Milner, acting executive director for finance, said: “Some credit balances are created as a result of banding changes in a street which require backdating several years. Where former residents of the properties have moved elsewhere it can, in some cases, be difficult to trace them. However, more effort should have been made to resolve this. Kier (Mouchel) propose to clear the current credits by October 31, 2015, and deal with new credits raised on a monthly basis with immediate effect."

Jonathan Isaby, chief executive of the Taxpayers' Alliance, said: "It's totally inappropriate for the council to hoard overpaid taxes. Where there are long-term issues, the council needs to do a much better job of tracking down the people it owes money to, and they must ensure that it never happens in the future.

"Council Tax hits families hard and it's simply not right for that money to be withheld from the people it rightfully belongs to."