Ask a StepChange (formerly CCCS) counsellor a bankruptcy question

FixitM · 23 March 2017 at 10:37PM

Hello. Please could you advise whether the OR allows an excess of £20 income, before considering an IPA (I'm sure I'd read that previously on here)? And also is there anywhere you can see confirmation that you have been discharged from bankruptcy (I should have been discharged in February, but husband is still in his 1st year, hence first question).

Thank you in advance.

FixitM · 23 March 2017 at 10:49PM

Sorry, another quick question please. Is there any way the OR would allow for membership of a weight loss group like Weight Watchers at all please?

Former_StepChange_Linsi · 24 March 2017 at 3:14PM

Hi

Thanks for your post. I did see your other post and thought it best to answer all your queries in one reply.

IPA
After covering your monthly living costs, if you have £20 or more left over the OR will set up an IPA for the whole amount. If you have less than £20, it’s unlikely an IPA will be set but not impossible. The OR would make the final decision but it’s rare.

Discharge confirmation
Should you need to apply for credit or a mortgage you can request a certificate of discharge. You’ll need to contact the court that dealt with your bankruptcy and pay the £70 fee to get this. If you need proof for any other reason, you can get a free confirmation letter by emailing [EMAIL="discharge.queries@insolvency.gsi.gov.uk"]discharge.queries@insolvency.gsi.gov.uk[/EMAIL]

You also can check the Individual Insolvency Register for confirmation and this is free as well. The register will show when you went bankrupt and what the status is now. Your details with be removed from the register three months after you’ve been discharged, unless you have a bankruptcy restriction undertaking or order.

It’s also possible to request the OR places an advert in the London Gazette confirming your discharge. Again, there’s no fee to do this but you have to make the request within 28 days of your discharge.

Memberships
I think membership of a weight loss group is probably going to be seen as a non-essential cost. Having said that, the OR may allow this cost on essential health grounds but this is something you’ll need to discuss with them.

I hope this helps.

Linsi

FixitM wrote: »

Hello. Please could you advise whether the OR allows an excess of £20 income, before considering an IPA (I'm sure I'd read that previously on here)? And also is there anywhere you can see confirmation that you have been discharged from bankruptcy (I should have been discharged in February, but husband is still in his 1st year, hence first question).

Thank you in advance.

Needafreshstart · 25 March 2017 at 9:50AM

Hello, i am 30 years old and i live with a partner and my son of 2years old. The accomodation is rented and the tenency agreeement is in her name and basically everything in the house belongs to her and not me as we were not together for almost a year. I am considering going bankrupt as i have a number of different debtors as well as 3 CCJs and i am not able to pay them all with my wages as i dont earn a great deal. About 5 years ago i had a very good job and was earning between £1000 to £1500 each week so i decided to take out numerous credit cards to build my credit rating so i would find obtaining a mortage easier. Anyway the short story is i was rather silly and developed an online gambling addiction which spiraled out of control to the point where i had a £5000 overdraft i maxed all my credit cards and i was so stressed out i eneded up losing my job and and had no way to then deal with the debts. I have worked since then but nowhere near that sort of money again so have just ignored every letter or correspondence from about 7 creditors or CCJs. I really want to make a fresh start as the stress really weighs me down although i just get on with it. I am no longer at the address where the letters are probably still sent but its just a matter of time before the catch up with me. My question is if i have nothing and basically we just get by what are they likely to do if i dont go bankrupt? I owe around £25000 in total and i just cant see a way to pay that any time soon as i earn after tax about 1400 a month and my cost of living is about 1600. We claim some working and child tax credit awards but without that we wouldnt be able to aford to live. Would going bankrupt be my best option? Can creditors get a warrent and enter the property even tho i dont own the belongings in it. Its a grey area and i dont want to cause my family any stress i dont have to so any advice on some of the areas i have mentioned would brilliant.

Thank you

Former_StepChange_Linsi · 25 March 2017 at 11:01AM

[FONT=&quot]Good morning,[/FONT]

[FONT=&quot]Thank you for your post and welcome to the forum.

[/FONT][FONT=&quot]I’m sorry to hear your debts are causing so much stress. We appreciate it can be a lot to deal with in addition to managing your household bills.

[/FONT][FONT=&quot]As a debt advice charity we can help you work out the best way to deal with your debts and CCJs. The advice and support we provide is free, impartial and confidential.

[/FONT][FONT=&quot]I really can’t say whether or not bankruptcy is the right option for you at the moment. I’d recommend calling our Helpline so that we can help you to create a budget detailing your income, living costs and debts. This will give us a better understanding of your financial situation and we’ll then be able to say whether bankruptcy is the right solution. Here are our contact details.

[/FONT][FONT=&quot]If it is the right solution we can explain the benefits[FONT=&quot], [/FONT]risks and process in more detail. If it’s not the right solution we’ll be able to recommend a better alternative.

[/FONT][FONT=&quot]In the meantime you can find more information about bankruptcy and CCJs on our website. There’s also some really useful information about what enforcement agents can and can’t do when collecting CCJs.

[/FONT][FONT=&quot]I hope this helps.

[/FONT][FONT=&quot]Linsi[/FONT]

Needafreshstart wrote: »

Hello, i am 30 years old and i live with a partner and my son of 2years old. The accomodation is rented and the tenency agreeement is in her name and basically everything in the house belongs to her and not me as we were not together for almost a year. I am considering going bankrupt as i have a number of different debtors as well as 3 CCJs and i am not able to pay them all with my wages as i dont earn a great deal. About 5 years ago i had a very good job and was earning between £1000 to £1500 each week so i decided to take out numerous credit cards to build my credit rating so i would find obtaining a mortage easier. Anyway the short story is i was rather silly and developed an online gambling addiction which spiraled out of control to the point where i had a £5000 overdraft i maxed all my credit cards and i was so stressed out i eneded up losing my job and and had no way to then deal with the debts. I have worked since then but nowhere near that sort of money again so have just ignored every letter or correspondence from about 7 creditors or CCJs. I really want to make a fresh start as the stress really weighs me down although i just get on with it. I am no longer at the address where the letters are probably still sent but its just a matter of time before the catch up with me. My question is if i have nothing and basically we just get by what are they likely to do if i dont go bankrupt? I owe around £25000 in total and i just cant see a way to pay that any time soon as i earn after tax about 1400 a month and my cost of living is about 1600. We claim some working and child tax credit awards but without that we wouldnt be able to aford to live. Would going bankrupt be my best option? Can creditors get a warrent and enter the property even tho i dont own the belongings in it. Its a grey area and i dont want to cause my family any stress i dont have to so any advice on some of the areas i have mentioned would brilliant.

Thank you

Maggie6 · 26 March 2017 at 9:53PM

I've recently been advised that my best solution to my financial problems would be to go bankrupt. I work full time but I only have £81 left after I have payed my bills. My hubby suffers with depression and anxiety and with this it's making him bad. We want to know what will happen . We have no assets but my hubby is worried that they will take our furniture or things that belong to my kids ( computers Tv ) as we can't provide evidence.
Can anyone advise please.

StepChange_Kirsty · 27 March 2017 at 8:36AM

Hi Maggie,

Thanks for your post and welcome to the forum.

I’m sorry to hear of the difficulties you and your husband have been facing. To give you some reassurance, there are certain assets which are exempt from Bankruptcy which include ‘such clothing, bedding, furniture, household equipment and provisions as are necessary for satisfying the basic domestic needs of the bankrupt and his family’.

Unless the items in question are of excessive value, the Official Receiver who deals with the Bankruptcy will not look to take these items. Also visits to check property are very rare at domestic premises; it’s only likely to happen at business premises.

If you haven’t already been in touch with us, I would recommend you give us a call so that we can make sure Bankruptcy is the right advice for your individual situation and if so we can get you in contact with our Bankruptcy Support team who can give you more specialist advice. You can find out contact details here.

Also you can find out more information about Bankruptcy here on our website.

All the best,

Kirsty

Maggie6 wrote: »

I've recently been advised that my best solution to my financial problems would be to go bankrupt. I work full time but I only have £81 left after I have payed my bills. My hubby suffers with depression and anxiety and with this it's making him bad. We want to know what will happen . We have no assets but my hubby is worried that they will take our furniture or things that belong to my kids ( computers Tv ) as we can't provide evidence.
Can anyone advise please.

Verora · 7 April 2017 at 5:10PM

My initial desire was to send a PM to keep my 'shame' private, but having read so many posts where people have bravely sought help I decided my own questions might actually help someone else too.

For many years I contracted and received income partly as PAYE and partly as Employee Benefit Trust (EBT) payments. Last year the HMRC finally passed legislation to declare this arrangement as a "disguised remuneration avoidance scheme". And also declared they would retrospectively apply the new law to the last 20 years.

I have been presented with 2 options, pay back the now called 'loans' to the Trust over the given period of 2 years, or attempt settlement with HMRC on what Income Tax, NI and compound interest I owe asap. I have for some years now been a PAYE permanent employee and so cannot afford either option.

I'm considering a 3rd option; file for bankruptcy. My spouse will remortgage the house to be the sole owner and pay me an agreed equity lump sum and reimbursement for joint belongings and contents. 34 years of marriage leaves individual ownership a little blurred and I am worried that HMRC might have the right to just claim everything regardless of who claims to own it.

If HMRC do not respect the claim that nothing in my house belongs to me then the only alternative I can see is to act on the financial separation agreement we have had drawn up by a Family Solicitor, apply for legal separation and move out of the family home.

By the way I'm not talking about protecting works of art or other juicy assets, just the old TV, couple of computers, two cats and typical family accumulated stuff. Even so, I need to know the best way to protect my spouse and their assets.

StepChange_Rachael · 10 April 2017 at 9:32AM

Hi

Thanks for getting in contact.

I’m sorry to hear you’re in this difficult position.

There are certainly a few options available for you to consider.

In terms of Bankruptcy the Official Receiver (OR) will overlook the Bankruptcy and their job will be to release any assets into the Bankruptcy.

The only assets that will be included in the Bankruptcy are those that are the Bankrupts. Anything jointly owned will be split between both parties. However, this becomes more complex when there is property involved.

Bankruptcy can risk a property. Only the Bankrupts equity would be included but to release this, its possible selling the property would be the only realistic option for many people.

The OR will also look in to past transactions meaning any transfers of assets in previous years, prior to Bankruptcy could be reversed by the OR.

It’s impossible to say exactly what the terms of the Bankruptcy would be as it depends on different factors and how the OR views your assets. However discussing this option with a debt advisor who can take into account your full financial situation will give you a better idea.

It’s also possible that there are alternative options available. You mentioned that there is a possibility of releasing equity. A review of your finances may also indicate other debt solutions could be possible options available to you.

If you’d like to explore your options further then you can find our contact details here for free and impartial advice.

Take care
Rachael

Verora wrote: »

My initial desire was to send a PM to keep my 'shame' private, but having read so many posts where people have bravely sought help I decided my own questions might actually help someone else too.

For many years I contracted and received income partly as PAYE and partly as Employee Benefit Trust (EBT) payments. Last year the HMRC finally passed legislation to declare this arrangement as a "disguised remuneration avoidance scheme". And also declared they would retrospectively apply the new law to the last 20 years.

I have been presented with 2 options, pay back the now called 'loans' to the Trust over the given period of 2 years, or attempt settlement with HMRC on what Income Tax, NI and compound interest I owe asap. I have for some years now been a PAYE permanent employee and so cannot afford either option.

I'm considering a 3rd option; file for bankruptcy. My spouse will remortgage the house to be the sole owner and pay me an agreed equity lump sum and reimbursement for joint belongings and contents. 34 years of marriage leaves individual ownership a little blurred and I am worried that HMRC might have the right to just claim everything regardless of who claims to own it.

If HMRC do not respect the claim that nothing in my house belongs to me then the only alternative I can see is to act on the financial separation agreement we have had drawn up by a Family Solicitor, apply for legal separation and move out of the family home.

By the way I'm not talking about protecting works of art or other juicy assets, just the old TV, couple of computers, two cats and typical family accumulated stuff. Even so, I need to know the best way to protect my spouse and their assets.

FixitM · 12 April 2017 at 10:29PM

Hello. Thank you for your responses to my last question. I wonder if you could help with another one please?

Last year we were on very low income (I'm a full time mum) and I had an arrangement of £60 per month for my council tax (I was discharged in February but hubby is still in his 1st year, but owed for the previous April and the full amount should have been £106 per month), Now we're in a new tax year we've received a bill for £175 per month, but obviously they still want me to also pay the £60 as well per month. I've been told the OR doesn't allow payment for any arrears, is this true? If so, what will I do about last year's council tax I owe?

Thanks.

Ask a StepChange (formerly CCCS) counsellor a bankruptcy question

Comments

Categories

Get our FREE Weekly email full of deals & guides - and it’s spam-free