Sequestration (Scottish Bankruptcy) & Redundancy

Chaz001

Hi


I've saw a few posts with regards to redundancy whilst discharged and I was under the impression that if you are discharged at date of redundancy, any redundancy pay out would not go to the OR.


However I made a general query to my OR and they have said that I would only get to keep the statutory redundancy pay out and the rest would go to OR. Does this mean the rules are different in Scotland?


I have asked for clarification but not had a response to date.


Any ideas?

coolcait

Chaz001 wrote: »

Hi


I've saw a few posts with regards to redundancy whilst discharged and I was under the impression that if you are discharged at date of redundancy, any redundancy pay out would not go to the OR.


However I made a general query to my OR and they have said that I would only get to keep the statutory redundancy pay out and the rest would go to OR. Does this mean the rules are different in Scotland?


I have asked for clarification but not had a response to date.


Any ideas?

Has the trustee actually taken on board that you were discharged at the date of redundancy?

What they have told you would have been broadly true if you had been made redundant before you were discharged. But, that's not the case here.

Ask them to cite the legislative basis for stating that payments in respect of a post-discharge redundancy will vest in the trustee

tigerfeet2006

Do you pay an IPA?

Chaz001

Yes at the moment

Chaz001

Sorry hit the reply button before I'd finished.


yes I am paying into IPA.


Trustee knows that I'm discharged, I have queried this but yet to hear back from them.


I don't want to appear to eager to get a response to this, if it turns out I need to pay all the money to my trustee I'll just need to take it on the chin and get on with it but I would like to know one way or another.


Thanks for all your responses.

Charlie

coolcait

If you have a look at the Accountant in Bankruptcy website www.aib.gov.uk, there's a section on 'guidance'.

That includes notes for guidance for trustees in sequestration.

The section on Redundancy pay refers to a court case yonks ago, which considered what parts of a redundancy settlement were considered as 'income', and what parts were considered as 'acquirenda'.

However, the rules on acquirenda only apply from the effective date of sequestration until the date you receive your personal discharge from bankruptcy.

So, your trustee COULD ask for an increase in your IPA to reflect the fact that you have received a statutory redundancy payment (defined as 'income').

Any other payments - such a payment in lieu of notice, ex gratia payments, or additional payments based on years of service and wages - would have been treated as acquirenda if you had been made redundant before the date of discharge.

As you are already discharged, those payments do not vest in the trustee.

Ask him to cite the relevant parts of the legislation which lead him to believe otherwise.

Chaz001

Thanks to everyone for their input. Coolcait, I will do that if I can get a hold of them. Thought it was normally the bankrupt person that avoids the OR not the other way round.


Charlie