Obligation to work during bankruptcy

paul0096

I'm thinking about going bk, but the Income Payments Order rules are pretty scary. Just £10 a month for emergencies (never mind an occasional pint) for three years :-o It does seem like a less drastic payment over a longer period would be more reasonable, but beggars can't be choosers I know.

It does make me think though (and feel free to have a go at me if it sounds too much like cheating) that with such a severe punishment, sitting out a bankruptcy on the dole would make sense. Especially if that meant no IPO was ever imposed. Please correct me if I'm wrong, but if you get to discharge without being given one, doesn't that mean you're safe afterwards? That should mean after 1 year my pay was my own again, instead of 3 years with an IPO.

Does the Official Receiver punish people who don't try very hard to get a job while bankrupt? Or (sorry, but I have to ask) what if someone quits a job just before going bankrupt? Of course I know that gets you in trouble with the Jobcentre, but I can't find any info about the OR's attitude.

My own situation is that I'm working part-time, making £450 a month, and it won't be easy to live on that even with no debts to pay. I could do a bit more hours if I was offered them, but I'm studying for an Open University degree so I can use the spare time too. Will I be given an IPO if I keep my job and my current hours? I would like to keep it, but I am really worried about the 3 year "sentence" of an IPO.

Maybe I should write an angry letter to William Hague, after all he keeps saying he's going to make work pay.....!

Thanks for your thoughts everyone.

Paul

debt_doctor

Hi,

Whether you work or not during your undischarged bankruptcy period is entirely up to you. The OR has no influence, however, as I think you realise, if you sign for job seekers you must look for work as part of the condition of benefit.

DD

paul0096

Yes, I know all about the Jobcentre :-/ I had to sign on for 3 months back in 2009, and I have a mate who has turned skiving into an art form. He's spent years playing the system and kept turning up with advice when I was claiming. Not that I am looking forward to it, but I think if I had to I could string out a claim for 12 months. I'd be more worried about being able to get another job after that.

Hope I can keep my existing job though :-)

Paul

Aytoun27

Hi,

I was working part-time when I went bk, though for higher wage than yours, the OR decided that I didn't have enough income to impose a IPA, even under the new rules I wouldn't have been earning enough for an IPA (I know, I worked it out). So you might find that if you went bk with your present £450.00 salary you wouldn't get an IPA, but it would depend on your outgoings. If your wage (or JSA) didn't leave you enough money to live on after bk your application for bk could be refused on the grounds that you would still be insolvant after bk. You might be well advised to post an SOA on here and contact CAB/CCCS before you make a decision.

dojoman

Why is an IPA a "sentence". BR should always be the last resort, remember it will give you a clean slate, and all your unsecured debts will be cleared allowing you to start again. If you were to enter into an IVA, then you would be paying something to your creditors for at least 5 years not 3. Also I don`t think you would have any surplus if you are earning only £450 a month.

paul0096

Thanks, I will try to do a proper SOA this weekend. Briefly though, since my hours were cut I've been using a credit card to pay some of my living costs. I've got other debts too, and I know I can't go on like this, but there are no jobs I am qualified for (until I finish my OU degree) that would do much more than cover my minimum payments. Even if I was offered one of those jobs with the economy in such a state.

I live in a shared house, and I think by riding my bike, shopping very carefully (which I'd have time for if I stay in part-time work) and not going to pubs I could make it through my BK year. Earning more, only to have all but £10 confiscated while also losing most of my study time, seems completely pointless - and barely surviving like that for three years, cut off from normal life, is honestly more than I could handle.

Aytoun27 wrote: »

If your wage (or JSA) didn't leave you enough money to live on after bk your application for bk could be refused on the grounds that you would still be insolvant after bk.

Aytoun, do you know of someone being rejected for bankruptcy because they would still be insolvent afterwards? What did they do?

Paul

paul0096

dojoman wrote: »

Why is an IPA a "sentence". BR should always be the last resort, remember it will give you a clean slate, and all your unsecured debts will be cleared allowing you to start again. If you were to enter into an IVA, then you would be paying something to your creditors for at least 5 years not 3. Also I don`t think you would have any surplus if you are earning only £450 a month.

I understand how you feel, and I will pay my debts if something comes up that would let me, but having only £10 a month for the unexpected is pretty grinding poverty. I've been on the dole before, as I said above, and I needed a lot of the spare time that gave me to go round all the cheapest shops, to do my OU coursework in the library so I wouldn't have to heat my flat, or to walk everywhere if my bike needed a new tyre that I couldn't afford. Existing at that level while working full time is pointless if there is any alternative, it really is.

Paul

mandyl

i wouldnt recommend people not work. it does nothing for your self esteem and confidence. i have no choice at present as im too poorly too, but as soon as i can i will try voluntrey and then a no pressure part time job.
br is a serious business but so far the best thing i did.

paul0096

Thanks Mandy, I do understand I am actually quite lucky to have a job and be in good health. I won't give it up lightly. Hope you feel better soon anyway.

Paul

Ineedaname

Have you spoken to one of the free debt advice charities yet? That's a prerequisite for going BR and Judges do ask the question.

Skyblue1

And sort of follows what happened to me. I lost my job and had to go bankrupt after struggling to pay debts for years whilst in work. I didn't get an IPA due to being on Jobseekers and the year passed pretty uneventfully. One thing I would say though is that in the current economic climate getting work is incredibly hard. I'm still on the dole (I have a BSc and MA in economics), I've applied for every job going including fast food restaurants. No joy. Either over-qualified or 'not what their looking for'. It's pretty bleak.

But on a practical note if you do choose to join the ranks of the jobless, or if your employers do as mine did to me and give you the push, don't whatever you do mention you're doing on OU course at the jobcentre. They'll probably stop your claim for JSA as you're not actively seeking work every hour of the week. Doing a course will probably improve your chances of securing a job afterwards, but they're really only concerned about getting as many people off the dole as possible in the short term.

Good luck with it - whatever you decide.