Money left to you in a will after discharge

terr123

Just out of interest, what happens to money left to you in a will once you have been discharged? I was under the impression that the OR only had an interest in it before discharge, but now I'm not sure. This is assuming that you are still subject to an IPA.

sieve

If the person died while you were bankrupt, then the OR will definitely have an interest in it.

If the person died after you were discharged but while you were subject to an IPA, then I'm not sure. If it's an NT IPA though, I am pretty sure you will get to keep it.

fermi

If the person died before you were discharged, then the OR is still entitled to claim it. If they died after your discharge, then they are not. It is the date they pass away that is important, not when you actually receive the inheritance.

If it is all after discharge but there is an "income based" IPA, then they can't claim any of the capital/assets under the IPA. BUT, if you use that capital/assets to derive an income (or use it replace/supplement income), then they may be able to claim a % of it under any existing IPA.

terr123

That's interesting. Nobody died and I hope it stays that way! I have been discharged and have an IPA for the next 29 months or so, I was just curious what would happen in that instance.

So the the bottom line is that the OR wouldn't have an interest in either cash or capital (assuming, for example, any cash was put in a savings account)?

debtinfo

Hi terr, quite correct, unless you stopped working to live off the money or put it into some sort of fund that paid a regular income to you