On JSA, new job to start just before automatic discharge

clintflickers

Hello everybody

Apologies if I'm asking something obvious, I've searched the forum and can't find the answer, although it has of course been great to hear that I'm not alone.

I went BR last November, having been sick for two years and on ESA. Over the last few months, however, I've slowly been recovering, which is great, and I've moved on to JSA and am really keen to start looking for work. However a quick check of the situation with the OR reveals of course that the goalposts have been moved significantly since my decision to go bankrupt and that 100% of any 'surplus' income is now taken by the OR. So if I get a job in 4 months after AD in Nov, I am free to keep my income. But if I get a job in 3 months, I will be forced to hand over the majority of everything I earn for 3 years, assuming I stay healthy. This seems an extraordinary state of affairs.

My question is basically how early I can start a job and not give the OR time to force me into an IPA or IPO, and how to best manage that process. It's more than likely that some people - particularly those struggling on 3 year IPAs - would have a problem with this. You should pay back debt if you can, they would say, and most of the time they would be right. All I can say is that the money was blatantly stolen from me by an ex-partner in the first place, who then went bankrupt owing me the full sum after a successful civil case, and that I have already repaid the high street bank in question the sum I borrowed (a large debt remained only because of the high interest rate that they forced upon me, and my very slow rate of repayment due to illness). Personally, I'm sure I do not morally owe them, or the Official Receiver, any more money.

I know I have 21 days to inform the OR of a change in circs, and then 14 days to look at their offer of a IPA. What does this mean in practice, would it be 35 days before date of discharge to be safe? Or presumably a bit longer?

Would b very grateful if anyone had an idea here.

Eager_Elephant

Just to let you know the IPO/IPA only lasts for a maximum of 3 years so if you got a job just before discharge then you would only pay for 2 years (plus a month or two).

EE

JCS1

Eager_Elephant wrote: »

Just to let you know the IPO/IPA only lasts for a maximum of 3 years so if you got a job just before discharge then you would only pay for 2 years (plus a month or two).

EE

Sorry, this is wrong. And IPA lasts for 3 years from the date it is set up, not 3 years from the BR date.

Eager_Elephant

I wonder if it depends on your OR then as people that I have helped with bankruptcy have gone on to get jobs months into their bankruptcy and they have only had to pay up to the 3 year mark not 3 years from the date the IPA/IPO was started.

Saying that the OR's in my local office do seem to be quite lenient!!

EE

JCS1

Eager_Elephant wrote: »

I wonder if it depends on your OR then as people that I have helped with bankruptcy have gone on to get jobs months into their bankruptcy and they have only had to pay up to the 3 year mark not 3 years from the date the IPA/IPO was started.

Saying that the OR's in my local office do seem to be quite lenient!!

EE

The IPA paperwork should be the same across all OR's offices, so all should be 3 years from date set up.

Eager_Elephant

Oops best I keep quiet then!!!

Although I wonder if my local office have got stricter since the new rules - I will have to ring my local OR and ask him.

EE

alastairq

hi and welcome.

You have answered your own questions regarding how long it takes for IPA's to be set up.....

However, don't forget, once employment is commenced, the SOA may need adjustment as well...it actually costs money to work, does it not?

Personally, I'm sure I do not morally owe them, or the Official Receiver, any more money.

As you might have already realised, when BR is petitioned, the BR literally hands over all financial administration of their affairs to an Official Receiver.

Assets are realised.

Administrative costs are deducted, and whatever is left over, gets divided pro rata amongst all known creditors.....any who are unknown at the time do have recourse, I suspect, but with the OR...likely dipping out in the process.

If a BR was in receipt of Benefits of some sort, then the administrative costs are met by the IS.....

Since these costs, on an individual basis, run to a few thousands of pounds [the figures have been quoted before on here] then it is likely, most IPA's simply get swallowed up in the costs of administering the BR estate.

For example, if a BR has provable debts amounting to, say 30k, then after BR is petitioned, the total bill facing the BR estate is increased by several grand.....it being perhaps unreasonable to expect the taxpayer to foot the bill....which is why the IS is supposed to be self-financing?


Thus....if no IPA is agreed, then it could be said that any such BR does indeed still 'owe' the IS for administering their estate?

fermi

Eager_Elephant wrote: »

I wonder if it depends on your OR then as people that I have helped with bankruptcy have gone on to get jobs months into their bankruptcy and they have only had to pay up to the 3 year mark not 3 years from the date the IPA/IPO was started.

Saying that the OR's in my local office do seem to be quite lenient!!

EE

Technically an IPA agreement can be set for less than 3 years, but as said the standard OR guidance and paperwork would mean 3 years as a matter of course.

I can only imagine that your local office have been incorrectly applying the standard guidelines for some reason?

alastairq

http://www.bis.gov.uk/insolvency/personal-insolvency/income-payments-orders-and-agreements#19

The IS is, as usual, like most other Government institutions, somewhat misleading over how long an IPA lasts.....
[the writing of information probably given to a less well-versed clerk, and not checked thoroughly...I come across this sort of thing at my place of work very frequently...sadly, urban myth sticks for years.]

However, the IS experts on here all state, the 3 years runs from date of agreement, not date of petition of BR.

clintflickers

Thanks for the comments. Possibly my post was unclear, I wasn't asking how long the IPA agreement lasts, I was wondering how long before automatic discharge the OR would need in order to enforce an IPA or IPO on a BR without an IPA whose circumstances changed, eg they got a job. Six weeks? Two months? Anyone any idea?

kepar

I know I have 21 days to inform the OR of a change in circs, and then 14 days to look at their offer of a IPA. What does this mean in practice, would it be 35 days before date of discharge to be safe? Or presumably a bit longer?

You have basically answered your own question.

If you are this worried why not wait until discharge, the you have nothing to fear.