Bankruptcy and employer.

PadiusGladius

Hi everyone, I was hoping that I could get some well needed advice regarding bankruptcy. I have checked the forums and can't find an answer to my query, so I am looking for some help.


I am considering bankruptcy as my expenses are far in excess of my income after separating form my wife and living on my own for the first time in 25 years. I work full time as a relief security officer covering various sites in the South-West and I need a car to work. I have a few questions:


1. Will the OR inform my employer that I have gone bankrupt?


2. I get travelling expenses at 40p/mile after 20 miles, but most of the sites I work or less than that, will the expenses that I do receive be classed as earned income and contribute towards what I have to pay the OR?


3. Will the OR allow me to keep my car worth about £1200 trade in as it is essential for work as I cannot realistically use public transport to reach some sites that I cover because of their location and the odd hours that I work?


Thank you for your responses.

alastairq

Hi....and welcome!

1. Will the OR inform my employer that I have gone bankrupt?

No.....!

However, your employer may have clauses & rules regarding BAnkruptcy and employees. You may need to consult your HR dept. on this topic.

3. Will the OR allow me to keep my car worth about £1200 trade in as it is essential for work as I cannot realistically use public transport to reach some sites that I cover because of their location and the odd hours that I work?

You will need to gather evidence to support your claim to have your car 'exempted-as-an-asset'.....There are rules governing this, see the stickies above.

Regarding [2]?

If your car is exempted as an asset, then you will be able to claim for the running costs, expenditures of running a car within your Statement of Affairs. See the stickies at the top for guidance regarding travelling expenses?

You primarily need to speak to either Stepchange, or National debtline [see stickies] to gain advice over your situation. [A Judge will want to know if you have done this, prior to granting a petition].

Finally, feel free to come back on this forum to ask questions or seek opinions..

TheGardener

PadiusGladius wrote: »

2. I get travelling expenses at 40p/mile after 20 miles, but most of the sites I work or less than that, will the expenses that I do receive be classed as earned income and contribute towards what I have to pay the OR? .

No - HMRC threshold for mileage rates is 45p. Reimbursed travel expenses are not earned income unless they are above 45p.

There is no guarantee at this stage you will have an IPA - do a SOA and post it so we can help

Although the OR has no reason to tell your employer, you may have an NT code. Although there are many reasons besides BR that might create an NT code - your employer will need to make the amendment to your code and may ask why?

alastairq

and may ask why?

That would be a 'breach of confidentiality' on the part of the person/department dealing with pay[rolls].

Such a breach could lead the payroll dept. into deep, hot water, with regards to all sorts of Law......and ..if it occurs, should be pursued to the bitter end.

On a personal, off-the-record basis, the reply should be...'none of your business?'

luvchocolate

Hi I am a relief shop manager covering 34 shops, so my car is essential..it had a value of £1400 and I was allowed to keep it as it is a requirement of my job to have transport.

my mileage is 45p and it shows on my pay slip as expenses the examiner had no interest in this, it is not classed as income.

Good luck, plenty of good people on here to help

PadiusGladius

Statement of Affairs and Personal Balance Sheet
Monthly Income Details
Monthly income after tax................ 1350
Partners monthly income after tax....... 0
Benefits................................ 0
Other income............................ 0
Total monthly income.................... 1350
Monthly Expense Details
Mortgage................................ 0
Secured/HP loan repayments.............. 0
Rent.................................... 500
Management charge (leasehold property).. 0
Council tax............................. 75
Electricity............................. 35
Gas..................................... 35
Oil..................................... 0
Water rates............................. 30
Telephone (land line)................... 20
Mobile phone............................ 20
TV Licence.............................. 12
Satellite/Cable TV...................... 10
Internet Services....................... 10
Groceries etc. ......................... 200
Clothing................................ 25
Petrol/diesel........................... 70
Road tax................................ 15
Car Insurance........................... 60
Car maintenance (including MOT)......... 20
Car parking............................. 0
Other travel............................ 0
Childcare/nursery....................... 0
Other child related expenses............ 0
Medical (prescriptions, dentist etc).... 10
Pet insurance/vet bills................. 0
Buildings insurance..................... 0
Contents insurance...................... 0
Life assurance ......................... 0
Other insurance......................... 0
Presents (birthday, christmas etc)...... 0
Haircuts................................ 10
Entertainment........................... 0
Holiday................................. 25
Emergency fund.......................... 10
Total monthly expenses.................. 1192

Assets
Cash.................................... 0
House value (Gross)..................... 0
Shares and bonds........................ 0
Car(s).................................. 0
Other assets............................ 0
Total Assets............................ 0


Monthly Budget Summary
Total monthly income.................... 1,350
Expenses (including HP & secured debts). 1,192
Available for debt repayments........... 158
Monthly UNsecured debt repayments....... 0
Amount left after debt repayments....... 158
Personal Balance Sheet Summary
Total assets (things you own)........... 0
Total HP & Secured debt................. -0
Total Unsecured debt.................... -0
Net Assets.............................. 0

I have posted my SOA, anyone care to comment on where I am over/under spending? I currently am working 5 days/week (60hours) even though I am contracted for 42 hours. (I worked all hours to try to pay the bills) However, including travelling it's nearer 72 hours a week, which is taking it's toll on my health and I seem to have no free time. I may have to drop a shift to 48 hours/week which would leave me with approx. £1200 month. Any thoughts?


Ps. I have not listed my debts but they are currently &550/month. My car insurance is expensive as I have 0 no claims as it is on my other HP vehicle which will have to be returned.

Kittycat1981

PadiusGladius wrote: »

Statement of Affairs and Personal Balance Sheet
Monthly Income Details
Monthly income after tax................ 1350
Partners monthly income after tax....... 0
Benefits................................ 0
Other income............................ 0
Total monthly income.................... 1350
Monthly Expense Details
Mortgage................................ 0
Secured/HP loan repayments.............. 0
Rent.................................... 500
Management charge (leasehold property).. 0
Council tax............................. 75
Electricity............................. 35 Seems high for the amount of time you are out of the house, we are a family of 4 in a 3 bed house and our bill is roughly the same. Make sure you read your meters regularly. Thought about switching to another supplier/do a comparison online. Dont leave things on standby- switch off at the wall when not using it. Energy saving light bulbs, charge phone at work/in the car etc etc
Gas..................................... 35
Oil..................................... 0
Water rates............................. 30
Telephone (land line)................... 20 do you need a landline? you are out at work a lot and have a mobile
Mobile phone............................ 20
TV Licence.............................. 12
Satellite/Cable TV...................... 10
Internet Services....................... 10
Groceries etc. ......................... 200 This seems really high for single person to spend in food? You could make savings here.
Clothing................................ 25 Could you miss a few months of not buying new clothes?
Petrol/diesel........................... 70
Road tax................................ 15
Car Insurance........................... 60
Car maintenance (including MOT)......... 20
Car parking............................. 0
Other travel............................ 0
Childcare/nursery....................... 0
Other child related expenses............ 0
Medical (prescriptions, dentist etc).... 10
Pet insurance/vet bills................. 0
Buildings insurance..................... 0
Contents insurance...................... 0
Life assurance ......................... 0
Other insurance......................... 0
Presents (birthday, christmas etc)...... 0
Haircuts................................ 10
Entertainment........................... 0
Holiday................................. 25 No holidays for a while
Emergency fund.......................... 10
Total monthly expenses.................. 1192

Assets
Cash.................................... 0
House value (Gross)..................... 0
Shares and bonds........................ 0
Car(s).................................. 0
Other assets............................ 0
Total Assets............................ 0


Monthly Budget Summary
Total monthly income.................... 1,350
Expenses (including HP & secured debts). 1,192
Available for debt repayments........... 158
Monthly UNsecured debt repayments....... 0
Amount left after debt repayments....... 158
Personal Balance Sheet Summary
Total assets (things you own)........... 0
Total HP & Secured debt................. -0
Total Unsecured debt.................... -0
Net Assets.............................. 0

I have posted my SOA, anyone care to comment on where I am over/under spending? I currently am working 5 days/week (60hours) even though I am contracted for 42 hours. (I worked all hours to try to pay the bills) However, including travelling it's nearer 72 hours a week, which is taking it's toll on my health and I seem to have no free time. I may have to drop a shift to 48 hours/week which would leave me with approx. £1200 month. Any thoughts?


Ps. I have not listed my debts but they are currently &550/month. My car insurance is expensive as I have 0 no claims as it is on my other HP vehicle which will have to be returned.

Good luck

i think sending the HP car back ASAP then using the NCB on the car you are actually using may help.

egrescrimp

This person is considering bankruptcy, so trying to reduce the SOA isn't going to help pay anything quicker. The SOA to me looks fine although I'd consider getting some content insurance which will be around £10 per month.

You also drive, do you live somewhere that doesn't have pay and display car parks? If so you are very lucky! I'd put down £10 to cover parking expenses.

xHannahx

I have to question the above post,
Clothing should be an average, not an expenditure every month, but year split over 12 months. Average of £25 a month totals £300 a year sounds very reasonable.
£35 electric is very low, the average UK electric bill is approx £1200 a year.
I agree £200 on food is high, we spend about that on a family of 4.
I notice you have put zero as entertainment, I think they expect everyone to put a small amount as they don't expect you to sit doing nothing in your own time, and certainly not good for well being doing nothing.

alastairq

Re- the above comments?

Bear in mind, the Op is looking to discover what would be acceptable figures within an SOA for Bankruptcy.....

£200 a month for a single person, for groceries, is, to my mind, somewhat low.
Bear in mind, 'groceries' doesn't just mean food! It also includes all other domestic expenditures, such as, cleaning materials, pet food, maybe even cosmetics? If the OP is 'out of the house' for prolonged periods, then that may involve having to 'eat out' more frequently...with the added costs that involves? It costs, comparatively, more to feed a single person, than to feed three or four....the economies of scale?

Holidays are allowed within a Bankruptcy SOA....and if there are more dependants within a BR household, so the amount allowed to be set aside can increase.

However, whilst a saving for holidays is allowed, it is not mandatory to take one! Such allowable expenses can be used to pay for other things as well.

Re-the landline? With a lot of broadband internet packages, a land line is mandatory. Also, having a landline is often required for certain other financial products [as well as being on the electoral roll?]

Whilst removing a landline is a good economy measure, essentially economy isn't really what is being sought with this SOA.....acceptable allowances being the objective.

If one has a higher-than-expected expenditure, then one may be called upon by an OR to justify, using evidence, that higher expenditure?

The electricity cost, per month, is about reasonable, considering an average has to be arrived at over the full year. The idea that someone who spends less time actually in the home, would use less electricity as a result, is limited. What is forgotten here, is that someone who spends a lot of time away from home, is going to need to make use of more labour & time saving domestic processes...such as, laundry? A tumble dryer is very heavy on power....for example...? Whilst it is nice to be able to devote time and energy to do such chores in a more economical manner....a single working person does not have that luxury of 'time'...

[As a 'single' working person, on the most economical tariff available to me, that monthly electricity bill is about right.....don't forget, we singlies like a warm home to come back to as well?]

EDit...............OOOOPpps, lots of folk with the same conclusions....

TheGardener

It is important to remember that the object of the SOA exercise is not to see how low you can get your expenditure in order to pay debts - it is to determine how much you need to live a 'reasonable' lifestyle. It's about finding the balance between 'reasonable' and 'padded' You are not expected to live on bread and water and dress in sack cloth.

I thought the electricity and gas were low and I envy kittycat if she has a 3 bed and her figures are that low, mine are nearly double that. There is a huge difference between for example, a well insulated modern home in the south and a Victorian terrace in the wilds of the north so you should put down whatever you use - the OR is not going to challenge 70 quid for fuel.
Food is fine, it has to cover everything including toiletries and cleaning stuff.
You are permitted to have an allowance for clothes so use it particularly if your job is hard on your clothes or you need to dress smartly for work.

Other travel - do you never pay for parking? I only go to town once a week but it costs me £10 a month to park.
It is not unreasonable to have a small contents insurance policy - mine is £50 a year and OR was quite happy with that. Is the petrol enough? most of us with older cars use rather more oil too which is not cheap.