Self Employed Sole Trader possibly going bankrupt...

pure_dead_dopey

worth talking to HMRC again, it's not a huge amount and if you're paying that a month, it won't be around for long.

are you sure your tax bill was right to begin with?

Musicjazz

...got cut off again.

I will certainly look into cutting this figure back further, but will be tough...

Was at the supermarket today for weekly shop... £74 for mainly essentials...:(

Thank you all for your advice so far... Really helps to be able to talk about it rather than it rolling around my head...

Just for my information, if I go personally BR would this effect my girlfriend who lives with me? We dont have any joint accounts or anything...

Thanks.

Musicjazz

pure_dead_dopey wrote: »

worth talking to HMRC again, it's not a huge amount and if you're paying that a month, it won't be around for long.

are you sure your tax bill was right to begin with?

Thanks Dopey.

Will maybe contact them about changing amount I pay in meantime.


Tax bill was correct. I was due around £1000 arrears for last year, plus around £1000 was due by 31st jan for this years tax and another £1000 will become due on 31st july, and finally another £1000 in jan 2013. My payment plan was to cover me for all this, and to be back to normal payments (around £200 per month) from jan 2013.

carrielovesfanta

Hi Musicjazz,

Can I ask a slightly personal question? Are you a self employed music tutor? I only ask because of your username and the fact that you are a sole trader and you use quite a bit of petrol.

If this is the case, I may be able to offer some advice on household expense etc because my OH was a self employed music tutor and we had a quite a bit of trouble with money (hence I'm here )

I can def offer you some advice with groceries though if you want to cut down. We budget £120 a month for the two of us, and we only have free range meat. It's easy to eat well on a budget with a bit of planning and a willing to cook.:)

kazwookie

Can you sign up with an agency / get other work for now?

I spend £30 to £40 per week for 2 of us, (all in ie food, cleaning stuff, etc)

katdes

Musicjazz wrote: »

Thanks katdes for the advice. I really dont want to go BR for obvious reasons. I initially thought I may be able to sort it out with a conolidation loan, but realise with my income at the moment, I wouldn't be able to pay this either (the bank wouldn't offer me one either). I then thought a trust deed would b:Ae the way to go, but after talking to CAB, they seemed to suggest that BR wwas my best option...
Thankfully, I dont need credit to run my business as its skill based. I've been trying my best to pay hmrc the £375 theyve asked, and have managed it for 4 months, but I've had to scrimp and save to do this. Often going without food for it... The problem I face now is the summer months are coming up, and this is notouriously bad for my business. I'm lucky if I make half the income I make the rest of year for around 6 weeks. What I've done in previous years is save a pot to help me get through (and pay all bills), but this year with paying the tax arrears, and minimum payments on cards, since january, I've barely had money for essentials, let alone save money for the summer and car insurance...

I think you should speak to Business Debtline they can give you immediate advice over the telephone. The advice they gave me is to offer everyone else a nominal sum and pay as much as you can to HMRC - even if its not the agreed amount. Ring them explain the situation and renegotiate the payment. Might also be worth speaking to your accountant and ask to look at your tax, as your income has fallen.:)

Musicjazz

Thanks Katdes.

I will look into that, and give them a phone.
Is it worth calling credit cards now and proposing a token payment in the meantime? Will this effect my ability to go BR if my case worker deems it neccessary? Only reason I ask is that I was advised on the phone by CAB not to enter into any long term agreement with creditors...(not sure why?...)

Payments for cards will be due in the next two weeks, and there is no way I can meet minimums this month...(in fact, I need to be saving for summer/car insrance)...

Cant wait to get telephone call for my meeting... Just be good to know what I'm doing, and what my future holds...Guess Ive only got another 2 weeks or so waiting in limbo....

katdes

Musicjazz wrote: »

Thanks Katdes.

I will look into that, and give them a phone.
Is it worth calling credit cards now and proposing a token payment in the meantime? Will this effect my ability to go BR if my case worker deems it neccessary? Only reason I ask is that I was advised on the phone by CAB not to enter into any long term agreement with creditors...(not sure why?...)

Payments for cards will be due in the next two weeks, and there is no way I can meet minimums this month...(in fact, I need to be saving for summer/car insrance)...

Cant wait to get telephone call for my meeting... Just be good to know what I'm doing, and what my future holds...Guess Ive only got another 2 weeks or so waiting in limbo....

Not sure about calling the credit cards as I haven't done that personally. I am not sure why CAB would advise that, perhaps they prefer to advise you before any arrangements are made. Do speak to business debtline, as they can help you and can help you over the phone.:)

dancingfairy

MusicJazz - you might find more bankrupty help on the bankruptcy forum on here. Just go to the pure money section and then choose bankruptcy.
In terms of phoning the credit card companies you may wish to give them a coutesy phone call to let them know that you are struggling and that you will make a nominal payment of 1 pound and that you will be back in touch with them once you have sought further advice (from CCCS or CAB). Do make sure though that you have sorte dout your other account first though. Also don't let them talk you into a payment plan over the phone as you need to see the whole picture. Most of the time it is recommended not to speak to creditors on the phone as they can be very persuasive and not always acting in your best interests.
I wonder also whether it is worth continuing the business - you say you are bringing home 1169 a month but spending nearly 300 on expenses, plus 200 a month to HMRC, plus car costs and petrol etc (plus are any of the debt business related?). You also said that during the summer the business brings in even less. I just wonder whether you might earn more by getting a regular job? Obviously I realise it's not that straight forward in reality but it is worth considering - Business Debtline should help you on that one.
Best of Luck

df

Scottishmummy

Hi Musicjazz

My OH is also selfemployed sole trader. We have a DMP with CCCS. The way we work out his income for the SOA is to take off ALL business costs as they come out of his profit and loss and only put on the SOA his ACTUAL take home. Like you some months can drop drastically so we use a worst case scenario for the monthly budget and then when he has a better month we can put a bit more aside for future payments. I am about to go on maternity leave soon and what we have managed to put aside we will use to carry on paying the same amount to CCCS so we don't need to reduce the payments when my earnings reduce.

I can't help with any info on bankruptcy but I do think it is a bit drastic to be thinking of that when so far you have managed payments. I would do as others have said and make token payments to your cards until you speak with CAB but I would also consider talking to CCCS to see if they come up with the same suggestion.