Partner Benefits in potential IPA

CricketTragic

Hi,

I'm looking at going bankrupt and was wondering about benefit income. I live with my wife and 2 step children. My wife receives all child tax credit (no WTC), child benefit and (occasionally maintenance). She spends the bulk of the kids outgoings from this. The child benefit is put in a savings account.

My question is do I still include all this as household income (and obviously reduce expenditure for potential IPA?) as this doesn't reflect my actual incoming and outgoings? Are they classed as dependents or, as I have no Parental Responsibility in the eyes on the law, not? I treat the children as my own but we've just kept the status quo with regard to tax credits etc and spending on kids.

Thanks for taking the time to help

debt_doctor

Hi,
If you wife was working then I would suggest that she provide a contribution from her salary after deductions for her own lifestyle (her own debts, spending money, etc - as she is not bankrupt)
However, as these benefits are child related, then it would be difficult to show anything other than they should be spent on the children.


Does you wife have any debts that came from buying things for the children (catalogues etc) as these could be a legitimate expense for her.


The children would be seen as dependent upon you, so if the benefit money required for the children is exhausted with their needs unmet, then certainly your income could be apportioned to any further child related costs.
DD

CricketTragic

Thanks for your help DD,

My partner works full time too. Would it be more sensible to put down all details on SoA and then put down all child related expenditure to the same amount or better to not include either the benefit income and the child-related expenditure it is spent on?

My wife has a credit card she is paying off, she isn't looking at any bankruptcy/IVA etc. so is this something the OR would take into account as my wife isn't going BR? Would it be a case of saying we make a 50-50 split on expenses less her debts she is paying? e.g. £2,000 expenses split 50/50 with, say, £25 debt payment would become a £1,025/£975 split between myself and her? Or would it stay at £1,000 each and the OR not allow it?

Thanks for your great help,
CT

debt_doctor

Ah, your wife is working too, ok.
In that case, as said earlier, I think she should put a contribution towards the household bills but should keep back some money for herself and some money for her own debt (perhaps more than the minimum payment). The benefit payments should also go in with this contribution.
You would then put all of your income in.
From this, the entire family expenditure would be deducted.


Why not pop up your SOA on here so that we could take a look?


DD

CricketTragic

Thanks for that, as I thought just wanted to double check. Here's some info and the SoA:

I understand that some things are high but I'm stating everything on here, for example we took out 2 year contracts on mobiles but the money issues have only been last 6 months. We have 2 kids with 1 (maybe multiple...) on the way and my income states £800 a month but I have no guaranteed hours (effectively a zero hour contract and had been as low as £400 and as high as £1,000). I have also pro rata'd some expenses, e.g. council tax, term-time childcare. Is that the right way or do I put monthly cost? Here is the SoA:

Statement of Affairs and Personal Balance Sheet

Household Information
Number of adults in household........... 2
Number of children in household......... 2 (+ more on way)
Number of cars owned.................... 1

Monthly Income Details
Monthly income after tax................ 800ish
Partners monthly income after tax....... 762
Benefits................................ 699
Other income............................ 0
Total monthly income.................... 2261

Monthly Expense Details
Mortgage................................ 0
Secured/HP loan repayments.............. 0
Rent.................................... 600
Management charge (leasehold property).. 0
Council tax............................. 107
Electricity............................. 33
Gas..................................... 33
Oil..................................... 0
Water rates............................. 27
Telephone (land line)................... 22
Mobile phone............................ 69
TV Licence.............................. 13
Satellite/Cable TV...................... 31
Internet Services....................... 25
Groceries etc. ......................... 500
Clothing................................ 150
Petrol/diesel........................... 180
Road tax................................ 18
Car Insurance........................... 25
Car maintenance (including MOT)......... 30
Car parking............................. 5
Other travel............................ 20
Childcare/nursery....................... 218
Other child related expenses............ 10
Medical (prescriptions, dentist etc).... 10
Pet insurance/vet bills................. 30
Buildings insurance..................... 0
Contents insurance...................... 9
Life assurance ......................... 0
Other insurance......................... 0
Presents (birthday, christmas etc)...... 20
Haircuts................................ 40
Entertainment........................... 10
Holiday................................. 40
Emergency fund.......................... 40
Total monthly expenses.................. 2415


Assets
Cash.................................... 0
House value (Gross)..................... 0
Shares and bonds........................ 0
Car(s).................................. 1000
Other assets............................ 0
Total Assets............................ 1000

No Secured nor Hire Purchase Debts

Unsecured Debts
Description....................Debt......Monthly...APR
Business Debt..................18000.....0.........8
Credit Cards...................3500......100.......0
Loan...........................4200......80........0
Total unsecured debts..........25700.....180.......-


Monthly Budget Summary
Total monthly income.................... 2,261
Expenses (including HP & secured debts). 2,415
Available for debt repayments........... -154
Monthly UNsecured debt repayments....... 180
Amount short for making debt repayments. -334

Personal Balance Sheet Summary
Total assets (things you own)........... 1,000
Total HP & Secured debt................. -0
Total Unsecured debt.................... -25,700
Net Assets.............................. -24,700

Created using the SOA calculator at stoozing
Reproduced on Moneysavingexpert with permission, using other browser.

Any help/support with over/under estimates would be greatly appreciated, its been a real struggle emotionally and just writing this has really helped me.

Thanks for reading and any help :A