Income /expenditure guide

gettingitsorted

Theres alot of people trying to do thier I/E's at the moment so i thought these guides may help .

http://bankruptcy.informe.com/viewtopic.php?t=29


http://www.hmrc.gov.uk/manuals/dmbmanual/DMBM800120.htm

betterlatethannever

Very useful sites, thanks you.

NekoZombie

Interesting - my OR was harsher with me than I thought....

Do these figures change monthly?

fermi

From everything you've posted Neko, it does seem that your OR's initial assessment of your I&E was a bit harsh.

Has there been any progress on the IPA front? I remember you saying that the OR themselves were looking at it, not just a minion.

The trigger figures given by HMRC are useful for giving a general idea, since they are derived from the same research as the ones the OR may use.
However as we all know the OR's are very keen on doing their own thing, and there is no guarantee that they will be the same or will be given the same weighting/consideration that HMRC do when calculating any surplus in your I&E.

NekoZombie

I thought the general consensus was that the OR was more generous than in those figures? Heh, not my administrator!

I didn't contest any of the figures she said - by the way, I've since found out that she *is* a minion, not the OR, so I was wrong about that. I do plan to contest them in the review that I am due in September (which will be 6 months BR for me) - so I suspect I won't get early discharge. The person handling my case is set on getting an IPA even though I'm currently in deficit by £25. God knows where they think the surplus will come from, but while they're holding the book open, so to speak, they can't conclude any investigations into my affairs, hence no ED.

Blurghhh!

fermi

NekoZombie wrote: »

I thought the general consensus was that the OR was more generous than in those figures? Heh, not my administrator!

That's exactly the problem.

We seem to see some OR's being more generous, and some less. That makes it very difficult to give advice other than put down everything you can, and see what your particular OR does with it.

Tim on DQ was meant to be bringing up with whatever organisation represents IP's the inconsistent attitude of some OR's, but I'm not sure if anything came of it. The sticky has now gone.

NekoZombie

I agree. I myself have said that these inconsistencies are of major concern. It introduces further uncertainty to an incredibly stressful process. I'm interested to know why OR's appear not to have set guidelines, yet the HRMC do.

I saw that sticky when it was up on DQ. As you say, it would be good to find out if anything came of it.

fermi

NekoZombie wrote: »

I agree. I myself have said that these inconsistencies are of major concern. It introduces further uncertainty to an incredibly stressful process. I'm interested to know why OR's appear not to have set guidelines, yet the HRMC do.

The guidelines are there, but they do not appear to be binding.

I'm sure you have seen this before, but for others:

Where the bankrupt appears to have income in excess of what is required to pay for his/her reasonable domestic needs and those of his/her family, an IPA should be considered by the official receiver based on the "real disposable income" that is available. If a bankrupt's expenditure appears to equate exactly with his/her evidenced income, leaving nothing to pay into the estate, the figures should be closely examined and a full explanation sought, especially where expenditure appears to vary considerably from the averages recorded for the relevant family group in the Family Expenditure Survey. Questions concerning previous debt repayments should also be considered, particularly as most bankrupts make payments of some sort to their creditors prior to the making of the bankruptcy order.

Whilst the creditor debts which the bankrupt has been attempting to service prior to bankruptcy from his/her income (and that of his/her partner as appropriate) may now be included as unsecured creditors within the bankruptcy proceedings, information concerning these pre- bankruptcy debt repayments may help to provide a context in which to consider whether amounts claimed by the bankrupt as necessary expenditure post bankruptcy are reasonable.

Each case must be considered on its merits but a consistent approach regarding reasonable expenditure must be maintained. This may mean that where a bankrupt has pared expenditure down to a level where it is likely he/she will have difficulty in funding their own reasonable domestic needs, it may be necessary to build in some flexibility, e.g. incorporating a monthly allowance for a moderate holiday (see paragraph 31.7.26). On the other hand, where it appears a bankrupt is seeking to avoid making any contribution in order to maintain his/her lifestyle at the expense of the creditors, all outgoings should be carefully examined and tested against guidelines provided, taking in to account the averages as shown in the Family Expenditure Survey and expenditure guidance at paragraphs 31.7.19 and 31.7.24.It is important to remember when making an assessment of expenditure claimed by the bankrupt that it is his/her reasonable domestic needs that need to be considered,[note 1 ] as opposed to basic domestic needs [note 2].

It should also be remembered that whilst the IPA is intended to provide some kind of return to the creditors, bankruptcy is intended to allow the individual to start afresh and remain solvent in the future.

Typically (or even conveniently ) the links to the OR's version of the 'Family Expenditure Survey' is a dead one.

I must admit, the red bit nearly made me spit out my coffee.

NekoZombie

fermi wrote: »

It is important to remember when making an assessment of expenditure claimed by the bankrupt that it is his/her reasonable domestic needs that need to be considered,[note 1 ] as opposed to basic domestic needs [note 2].

I'll remember that, as I reckon my OR has got 'basic' and 'reasonable' mixed up. :rolleyes:

gettingitsorted

bump to the top

betterlatethannever

Quick question, is it best to try to get your income and expenditure balanced? My outgoings (just essential, not holidays, hair cuts etc) exceeds my incoming, although i am working hard to rectify this.