Planning for bankruptcy - SoA and voluntary work

Huey_McGruey

Hello,

I am a newbie and I have been lurking on this board for a little while and now that my husband and I have set a court date for bankruptcy on 7th May I am looking for a bit of advice. Additionally we have spoken twice to Step Change who have advised bankruptcy.

Very briefly the reason why we are going bankrupt is sadly due to a failed business which we are/were both partners in and have been struggling with for about 2 and a half years. The business debt combined with some personal debt totals £105,000 between us. The business closed down a few weeks ago when it came to the end of a shop lease and although we managed to get £11,000 from a buyer for the shop fittings, equipment etc. that clearly isn't enough to pay the debt.

Our current employment status is that I am employed full time as a teacher and I haven't been working in the business for some time. My husband is currently working in a six week temporary position which he started on Monday and doesn't currently have another job to go to after that. He was briefly unemployed between handing over the business and temping.

My husband has been planning to go back to education in September since we put our business up for sale last year and now that we are going bankrupt we are trying to work out the best way to approach things. Looking at our SoA as it stands we don't have any spare income to pay in to an IPA as it is based on my salary alone and some working tax credits (which I am not sure we can still claim due to my husband now being unemployed and have been trying to get through to HMRC today but no luck yet).

My first question is how would I put my husbands income on the SoA with it only being a six week position? I am also due between £600-£800 for some external work I have done for an exam board but that is just a one off payment. How do I show that?

Secondly as my husband is going back to full time education in September for a year we will have a period of 4 months where he may be able to find paid work. I understand that if we get extra income in this time it will then cause an IPA to start and he will pay whatever he earns in to this. The work that my husband is ideally trying to get is in quite a competitive industry and he has been sending out speculative letters etc. for a while to try and get any position without any luck. We are now considering him working voluntarily for an organisation in his chosen field rather than getting paid work for these 4 months as we figure it is quite a good opportunity for him to get experience. Is him not looking for paid work going to cause any problems with the bankruptcy? I suppose some might say we were trying to avoid paying an IPA but we know if we were in a different situation he wouldn't be able to do voluntary work as we wouldn't be able to afford it but this gives us an opportunity to strengthen his CV for the future. Furthermore he isn't able to claim job seekers allowance due to the contributions that self employed people make not being enough.

Any advice or comments would be very welcome and thank you in advance for taking the time to read this

JCS1

You would need to enter his monthly income as at the date of the bankruptcy (I would also suggest adding a note at the end to say temporary job to last until x date).

The OR has no say as to whether you are working or not. If there was an IPA set up, you would simply need to notify them of the change of circumstances in September and it would be reviewed.

JCS1

Nearly forgot - the exam board payment needs showing as a debtor/asset. I suspect they will then write to the exam board and ask them to pay over direct to either the Insolvency Service or Moonbeever.

Huey_McGruey

Thank you JCS1. I don't know if I'm being a bit blonde but my husband won't have had a pay day before we go bankrupt, so I'm still a bit confused! (I think his first pay day is 16th May and we go BR on 7th May)

sovilla

JCS1 wrote: »

Nearly forgot - the exam board payment needs showing as a debtor/asset. I suspect they will then write to the exam board and ask them to pay over direct to either the Insolvency Service or Moonbeever.

Why would that need to go to the OR? So if she does any extra work the OR take all of it, surely that can't be fair.

JCS1

sovilla wrote: »

Why would that need to go to the OR? So if she does any extra work the OR take all of it, surely that can't be fair.

Because I suspect the OP is set up as a self employed for exam work. It would therefore be classed as a book debt and the money would go to the OR as a asset.

Huey_McGruey

Hi there,

Thanks for your replies. I am actually employed by the exam board, in that they take away the tax etc at source so I don't fill in self assessment forms etc. Will this change the way I should present it on my SoA?

Thanks

sovilla

Huey_McGruey wrote: »

Hi there,

Thanks for your replies. I am actually employed by the exam board, in that they take away the tax etc at source so I don't fill in self assessment forms etc. Will this change the way I should present it on my SoA?

Thanks

I would say then it is an income and would need to go on your SOA as such. But mention that is not regular.