Income Changes Post IPA/BR

menageamoi

hi

Just thinking ahead. I was made BR in January and have no IPA as I don't earn enough. That's about to change in a month or two so I'll tell the OR and see if that generates an IPA. If it does, then let's say it's for 3 years. My question is - what happens if my salary goes up again ( or down) after I'm discharged from BR - can I apply to have it reduced or can they have it increased once we're outside of the BR year?

thanks

National_Debtline

Hi menageamoi


If you're going to have an IPA, this has to start before you are discharged from BR. But if an IPA does start you're obliged to inform the OR of any changes in your circumstances that will affect your income and outgoings until the IPA comes to an end. Depending what the change is, this could lead to your IPA being increased or decreased.

Susie
@natdebtline

menageamoi

Thanks Susie

So any IPA might reduce or even end if my income dropped below a certain level for its duration? But it could also increase if my income went up further?

National_Debtline

That's exactly right menageamoi. If they believe you can afford £20 per month, or more, after paying your usual bills they can put an IPA in place. It will take all of the surplus money you have spare. If you do have a change in circumstances just make sure you let the OR know.


Susie
@natdebtline

LincsPaul

Best thing may be to ensure your income is low enough (or permitted expenditure high enough) to avoid an IPA before discharge, as an extra 2 years of all your spare cash being taken isn't ideal!

menageamoi

Thanks - yep - that's the plan! At least my income will rise gradually and incrementally from this point so I'll know the trigger point for the IPA. Hard to tell how much slack I have at the moment!

Jono987

You could offer for a family member to pay your IPA in one lump sum - if you have a family member willing to help you. I went bankrupt in December 2016 and given an IPA. My mother paid my remaining IPA off in October of last year so it was i think 26 x my monthly payments.

This means my IPA was officially concluded and after i was discharged on 30th December 2017 i can now freely earn as much as i want. I got a massive pay-rise when i switched jobs in February but can now keep it all so i can save for a house / new car etc

debt_doctor

Jono987 wrote: »

You could offer for a family member to pay your IPA in one lump sum - if you have a family member willing to help you. I went bankrupt in December 2016 and given an IPA. My mother paid my remaining IPA off in October of last year so it was i think 26 x my monthly payments.

This means my IPA was officially concluded and after i was discharged on 30th December 2017 i can now freely earn as much as i want. I got a massive pay-rise when i switched jobs in February but can now keep it all so i can save for a house / new car etc

Hi Jono,

I've never heard of that happening before, very interesting.
Did you ask for an 'IPA settlement' or was it offered to you?

DD

menageamoi

Yes Jono/DD

That's really interesting. Makes it really worth thinking about if a) there's a chance my salary might increase substantially over the next few years b) I could find someone to pay it! :-)

LincsPaul

Hmmm are you sure about this early pay-off option? All I can find is this in the technical manual:

31.7.175 IPA/IPO variation to deal with receipt of a pension/ lump

Unfortunately my phone isn't letting me copy and paste the whole section but basically this accounts for the grabbing of the remaining value of the IPA should you come into money (e.g. pension lump sum or gift, lottery win etc).

What it doesn't do it let you off the hook should your income go up and the 3 year period is still active. Might want to check the small print.

menageamoi

Yes I came to the same conclusion - not sure how Jono managed to get them to write it off irrespective of future earnings within the IPA period of three years?