Butts Lightning Bankruptcy

13

Comments

  • fatbelly
    fatbelly Posts: 20,444 Forumite
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    Butts wrote: »
    One thought occurs to me - why on earth would anyone choose option 2 ?

    Because they don't read the letter, and that is what happens if you take no action in relation to your monthly premium nor in relation to the OR's letter.

    There are a lot of people who never open their post...
  • Butts
    Butts Posts: 1,289 Forumite
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    Just to keep people updated with the events in my Bankruptcy...over a month now :cool:

    Pleased to say my Yorkshire Bank Account (pre-bankruptcy) is still functioning so looks like I have escaped the post-banruptcy closure that blights a lot of people.

    More good news - The Inland Revenue have effectively given me a pay rise as I have been issued an NT Code. As the OR is not setting an IPA due to my (deliberately) pitiful earnings the dosh will be mine to keep. Even with the tax money in my pocket I am still over £100 light of an IPA (on paper :D)

    My Life Insurance Policy I have paid the OR £50 so hopefully won't peg it before discharge when the Policy will return to me.

    Virgin Media - my Mobile Phone is still live despite the demise of my Virgin Media Account - just had the latest bill. NOW TV going in next week with broadband - using a prepaid toggle till then.
  • StopIt
    StopIt Posts: 1,470 Forumite
    Butts wrote: »
    Just to keep people updated with the events in my Bankruptcy...over a month now :cool:

    Pleased to say my Yorkshire Bank Account (pre-bankruptcy) is still functioning so looks like I have escaped the post-banruptcy closure that blights a lot of people.

    More good news - The Inland Revenue have effectively given me a pay rise as I have been issued an NT Code. As the OR is not setting an IPA due to my (deliberately) pitiful earnings the dosh will be mine to keep. Even with the tax money in my pocket I am still over £100 light of an IPA (on paper :D)

    My Life Insurance Policy I have paid the OR £50 so hopefully won't peg it before discharge when the Policy will return to me.

    Virgin Media - my Mobile Phone is still live despite the demise of my Virgin Media Account - just had the latest bill. NOW TV going in next week with broadband - using a prepaid toggle till then.


    Wait a minute!


    I thought the only reason why you get an NT tax code is to pay that to the OR.


    Check with them but see here: http://forums.moneysavingexpert.com/showthread.php?t=1972793


    That tax money is going to have to be paid to someone I'm afraid!

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  • Butts
    Butts Posts: 1,289 Forumite
    First Anniversary First Post Name Dropper
    StopIt wrote: »
    Wait a minute!


    I thought the only reason why you get an NT tax code is to pay that to the OR.


    Check with them but see here: http://forums.moneysavingexpert.com/showthread.php?t=1972793


    That tax money is going to have to be paid to someone I'm afraid!

    I think it depends on the sum involved - if miniscule I believe I will keep it.

    The letter from the IR says "We MAY make a claim to your trustee for the tax that employer would have taken off it if you hadn't been declared bankrupt" In order for that to happen you have to be making payments to the OR via an IPA albeit only an Income Tax one which I am not.
  • bewildered1
    bewildered1 Posts: 69 Forumite
    Butts wrote: »
    I think it depends on the sum involved - if miniscule I believe I will keep it.

    The letter from the IR says "We MAY make a claim to your trustee for the tax that employer would have taken off it if you hadn't been declared bankrupt" In order for that to happen you have to be making payments to the OR via an IPA albeit only an Income Tax one which I am not.

    I'm not so sure that it's true that you won't have to pay the money to the OR even though you don't have an IPA.

    My advice would be to put the money away until you have had it confirmed from the OR themselves that they don't want it. If the OR decides he/she wants the tax money but you've spent it you could be getting yourself into trouble.
  • Butts
    Butts Posts: 1,289 Forumite
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    bewildered1 wrote: »
    I'm not so sure that it's true that you won't have to pay the money to the OR even though you don't have an IPA.

    My advice would be to put the money away until you have had it confirmed from the OR themselves that they don't want it. If the OR decides he/she wants the tax money but you've spent it you could be getting yourself into trouble.

    It costs the OR £150 to set up an NT IPA which is supposed to come out of your first payment.

    If we are talking £30 or £40 month in Tax for 5/6 Months it is hardly worth the risk to them or economically viable.

    The guidance does allow for retention of this sum by the Bankrupt if they are otherwise impoverished and it's addition will not result in being anywhere near eligible for an IPA overall.
  • bewildered1
    bewildered1 Posts: 69 Forumite
    Butts wrote: »
    It costs the OR £150 to set up an NT IPA which is supposed to come out of your first payment.

    If we are talking £30 or £40 month in Tax for 5/6 Months it is hardly worth the risk to them or economically viable.

    The guidance does allow for retention of this sum by the Bankrupt if they are otherwise impoverished and it's addition will not result in being anywhere near eligible for an IPA overall.

    I take it from the info above that you've actually had it confirmed by the OR that they won't be requesting that money from you then. Well that's good to know for future reference.
  • Butts
    Butts Posts: 1,289 Forumite
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    bewildered1 wrote: »
    I take it from the info above that you've actually had it confirmed by the OR that they won't be requesting that money from you then. Well that's good to know for future reference.

    During my Interview they said an IPA of any variety would not be invoked due to my low earnings and deficit of £160 between Income and Expenditure.

    However you never know.....:eek:
  • Flora_McDora
    Flora_McDora Posts: 39 Forumite
    First Post First Anniversary
    You said that you won't have an IPA. because of your income/expenditure deficit after your bankruptcy but didn't they ask (in interview) how you were going to manage with a deficit?
  • Butts
    Butts Posts: 1,289 Forumite
    First Anniversary First Post Name Dropper
    Flora_McDora wrote: »
    You said that you won't have an IPA. because of your income/expenditure deficit after your bankruptcy but didn't they ask (in interview) how you were going to manage with a deficit?

    Strangely enough no. The impression I got as that it was a "tick box" excercise. Provided what you were claiming for as expenses was within the proscribed limits how you were going to fund it was an area not explored.

    They told me they would not be applying for an IPA due to the defecit, although I have not received confirmation of this in writing.
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