Household surplus income question

rufusthedoofus

My partner has applied to go bankrupt. We have just had the official receiver interview and I am really upset to find that the OR will take my income into account when determining how much 'household income surplus' we have between us.
It has take me a really long time to work up to the income I earn now after years of struggling as a single parent (prior to this new relationship with him) , everything I read on here and other places said that they would only look at my partners income and that I would not be liable for his historical debts... but the fact is that I am, Because they will aportion part of my income into the surplus 'household' income and then that will have to go to his creditors, I am so so upset. Worse still, they will assess what we put on their as to whether it is 'reasonable' ad that makes me so angry because I earn my own money and if I want to spend £x on clothing or food then I will and I shouldn't have to be assessed as to whether that is appropriate...
We currently share the household costs that I pay 2/3 of them and he pays 1/3 as I earn more than him... but we do not split any surplus.
We have been together under two years and moved in together in April of this year.. we are on a tenancy agreement together... only because the agents insisted his name was on their too and said it had to be legally.. I cannot believe that this is happening and through my income I will end up paying for some of these debts....I have never been able to afford to save for a house, and have recently started doing this after years of hard work, and now it seems I won't be able to do that ... how can this be fair? If I had thought this would be the case I would have waited to move in with him
Does anyone have experience of this, and may be able to advise?

kwame41

If the receiver has told you this then I dont see there is much you can do about it.

Dont take this the wrong way but if you are now financialy tied to your partner then there is only one solution.

Your partner is very lucky that he has you to help him out of his mess.

Daniel1971

Maybe you have misconstrued what the official receiver meant? He should be taking the household budget into account and within this you can only list what he deems to be reasonable costs which can be tighter than a normal budget. Taking the household budget is to ensure that a fair division of bills is occurring, you have already stated you pay more due to higher income so this shouldn’t be a problem.

The OR would not be expecting you to pay for your husband’s debts, he will account for you having a leftover share of the surplus and out of this if you want to spend more on clothing or whatever you like that is your choice

TheGardener

I think you are misunderstanding some of this: You are not paying off debts - the debts are wiped out with the BR. However, the 'surplus' (contribution to the OR's fees and the creditors)is taken from your partners residual income after their share of the household expenditure - the residual amount of your income after you have paid your share of the household expenses is yours - not the partners or the ORs.

As you are aware, where one half of a couple is going BR then the OR looks at the over all household income. So if you both earn about the same - the OR will split the household income equally between you so you would expect a 50/50 split on household expenses. If the BR earns less or more than their partner then the split will be adjusted by percentage up or down depending on the difference.
If the non-BR partner refuses to disclose their income to the OR (which they are quite entitled to do) then the OR will go with the 50/50 split. Some might suggest that if the non-BR partner earns the most, there are some advantages to them refusing to declare their income..

Did you get professional advice before your partner went BR?

fatbelly

TheGardener wrote: »

If the non-BR partner refuses to disclose their income to the OR (which they are quite entitled to do) then the OR will go with the 50/50 split. Some might suggest that if the non-BR partner earns the most, there are some advantages to them refusing to declare their income..

This is the important point.

From the technical manual:

31.7.72 Ascertaining partner’s income where bankrupt does not co-operate

Where resistance to the disclosure of the partner's income is encountered, in the absence of any information to the contrary, it is appropriate for the official receiver to assume that the working partner pays for 50% of all household expenditure. This will enable an income payments calculation to be completed to ascertain whether there is any surplus, and the bankrupt’s share of that surplus, against which an IPA/IPO can be sought. It is likely that an assumption of this nature will provoke a response from the bankrupt and/or their partner and if the required information concerning the exact amount of the partner’s income is then received, the official receiver may re-calculate the income and expenditure of the bankrupt taking in to account this new information.

TheGardener

The real potential damage to the partners of BR's is though financial links such as joint bank account, both names on the gas bill etc - this you should avoid at all costs as the link will seriously damage your credit history and any future attempt to get a mortgage.

As you have already disclosed your income to the OR there's not much you can do now. A good advisor could have helped with this but I know its frustrating.

rufusthedoofus

Thank you all for your help.
I am going to disassociate from him via the credit ref agencies and take him off bills etc following your advice.
I feel that I've been tricked really in disclosing my income as it doesn't make it clear on the form that the partner doesn't have to.... I haven't done anything wrong. My finances are in order and I will not them let the OR use any of the 'so-called household income 'to go into my partners pot for creditors he owes from way before we met.. The OR was saying I could count some toward my daughters Uni (at an acceptable amount) and I was so shocked... thats my income for my child... and I am not going to have it assessed as acceptable or not.
The OR is sending the income and expenditure forms, and I will make it clear my contribution to the bills, rent and food.. I pay 2/3 my partner pays a 1/3. I will not allow the OR to take anything else as any other surplus is not household income it is my income. We keep our finances separate, we int have a joint bank account we don't share our surplus money.
He got advice from Taxaid and Stepchange and I have been trying to get through to debt line but no luck yet. I have emailed a legal company today so fingers crossed I can get some help.

fatbelly

I think you mean National Debtline. Yes, they're good and give advice by phone or webchat but not Saturday afternoons or Sunday.

He doesn't have to agree to an Income Payment Agreement but the Trustee may apply to the courts for an Income Payments Order if he does not

In practice there is some room for some negotiation in this process

https://www.insolvencydirect.bis.gov.uk/technicalmanual/Ch25-36/Chapter31/part7/part6/part_6.htm

https://www.insolvencydirect.bis.gov.uk/technicalmanual/Ch25-36/Chapter31/part7/part5/part_5.htm

TheGardener

rufusthedoofus wrote: »

... I will not allow the OR to take anything else as any other surplus is not household income it is my income. ...

The OR can't take your 'surplus' income - its just about the household expenditure. The OR can only take an IPA from your partners income. Any personal expenditure of yours does not have to go on the forms, only the joint expenses such as rent/energy etc.
However, you will be liable for the full council tax bill I'm afraid.
The advisors should have made all this clear to you but I understand that the whole thing can be very confusing if you are not familiar with it.
If the IPA comes though and you both feel that the amount is unreasonable your partner can challenge it and negotiate. Ultimately the OR will expect your partner to sign the agreement but don't feel you have to accept the first draft.

TheGardener

TheGardener wrote: »

.... Any personal expenditure of yours does not have to go on the forms, only the joint expenses such as rent/energy etc....

sorry - for clarity - your partner will have to put on ALL their expenditure on the form, joint domestic stuff and any personal expenses. You don't have to do that - you only need to include the shared domestic stuff.

It fine for you to explain to the OR that your cooperation only extends to shared expenditure - but with a smile of course - its always wise to keep on the right side of the OR

rufusthedoofus

Thanks all for your help, feeling more reassured now