Bankruptcy and Pension

Tricia53

I stopped working in February 2009 because of ill-health and have been receiving IB and IS (recently changed over to ESA - Support Group). I have debts totalling just over £21,000, which I was paying off with a debt repayment plan with CCCS until December 2010 when I was advised that bankruptcy would be the best route for me. Since then I have been paying my creditors a minimal amount and attempting (unsuccessfully) to save the court fee to declare bankruptcy. Two months ago I applied to my occupational pension fund (Local Government Pension Scheme) to have my pension benefits paid early on the grounds of ill-health. I had to see their medical advisor, who has subsequently submitted a report confirming that I am permanently incapable of employment for reasons of permanent ill-health. I have chosen to take the maximum lump-sum payment (amounting to £+- £5,000) with an annual pension of £781.01. Obviously, I am going to use some of this money to go to court to declare bankruptcy and I want to know what happens with both my lump sum and annual pension. I have read many threads on the forum but am still not sure if this money can be included as assets in my application.

I would be very grateful for any advice.

Regards

Trish:)

antrobus

Bankruptcy - what happens to your pension
http://www.direct.gov.uk/en/MoneyTaxAndBenefits/ManagingDebt/Bankruptcy/DG_187413

Tricia53

Thanks for the link - but this still does not make it clear for me. If anyone can put it in really simple terms, I'd be grateful!

Trish

debtinfo

If you receive the money before the bankruptcy and stillhave it on your bankruptcy date then it could be taken as cash/savings in hand. As for the annual pension part, that is just taken into account as income and assessed along side any other income