Lila Bankruptcy in Scotland and Income Support.

melissa-elizabeth

Over the past few months at work, my overtime has been cut down dramatically and I’m not getting any at all now. I am only contracted to 10 hours a week, but I've always managed to get an extra 30 hours a week until that point. I had two loans via the bank of Scotland and an account via an on-line catalogue and was paying around £400 a month to all three, which wasn’t a problem because I was coming away with £1500 a month.

When I do overtime, it goes in a month after. For example all the overtime I done last month in October (hardly any) will go in at the end of this month and all the overtime I get this month (none at all) goes in at the end of December and so on and so forth. I got £1100 this month because I got good but slightly less overtime in September, which means I’m actually struggling slightly, but okay. BUT I know that next month I’m only going to get roughly around £750 and if I don’t get any overtime before this payment period is up, I’m only going to get £530 in January (which is my basic with NO overtime at all.)

I contacted Step Change and they did a budget for me beginning December, my total income will be £750, my total Expenditure is £732, so my surplus will be £18. We decided together that the best course of action would be a temporary payment plan where I would send £5 to each of my creditors. (£10 to Bank of Scotland and £5 to on-line catalogue). I have already sent the letters off to the creditors informing them that they will be receiving said payments next month. BUT now my live in landlord has informed me that she is putting my rent up from £300 to £320 a month because of the rising gas costs, (casual agreement - no papers signed.) which is fair enough, but obviously now I won’t have any surplus! And obviously I’ll only get £530 in January so I’ll have even less then!

We did discuss the option of myself going bankrupt, but the reason I didn’t want to is because I wasn’t sure if during the year my overtime would go up again, but it doesn’t seem likely right now. My question is - how much can you earn before they can claim money off you? I’m assuming it’s my now £752 expenditure and they’ll take anything I earn above that? Or am I allowed to keep any of the surplus? Obviously if my overtime does go up and down, does that mean I’d have to send an up to date budget and payslips every month?

Another thing is, I was looking at the Lila forms that I would have to fill out to declare bankruptcy and they require three months’ worth of payslips. The last three months of pay slips have went over the LILA minimum wage requirements because I obviously had all my overtime, so does that mean I have to wait until I get my next three pay slips (will get the third at the end of January) to claim? Because I won’t be able to afford to give my creditors ANYTHING now so how do I not pay them anything and have to put off bankruptcy until I have the low income evidence? Or is there anything else I can do?

I have worked since I was 16 and have always paid tax, but obviously I will have to start looking at what benefits I can claim from January. If my expenditure is £752 and I'm only getting £530, I'll obviously have to get the £222 from somewhere? I'm not sure if I can claim housing benefits because its the room I rent, not the flat? Also some weeks I work above 16 hours and some weeks, I work below, would I be able to claim income support tax or tax credits?

The reason why my overtime is cut is because they are trying to save money, so rather than get overtime people in – they are just moving people where required.

I have been looking for other jobs, but they're mainly part time, don't pay as good as my current job even without the overtime and expect you to be flexible, which means leaving my current job for something that pays less. (I get £7.67 an hour, work 5 hours on a Saturday & 5 on a Sunday so time and a half on a Saturday and double time on a Sunday) I have been putting my CV's in everywhere also but haven't heard a peep back from any.

I am literally pulling my hair out right now and I’m completely stressed, hence why I'm still up at 5:45 in the morning without any sleep.

Any advice would be great,

Thanks,
Melissa

wildheart83

First things first, relax!
I can see your thinking behind waiting until January to go BR, creditors are unlikely to take action within 3 months, assuming you've been up to date until now? If it was me, I'd stop paying now and use the money to pay the BR fees, but I stress, it's only my opinion.
The only difference with LILA is that it's low income low asset BR, ie you're not earning over the threshold per week (min wage *40 hours per week I think) but what you pay solely depends on your outgoings. If you change jobs your outgoings may increase etc and will account for reasonable living expenses, not just the bare minimum so many people have scraped by on.

Have you spoken to Citizen's Advice? They were absolutely brilliant with me as I had no experience of the BR process.
Good luck Melissa