DRO limitations

sallymanton

Good evening
Just after some guidance, and who better to turn to then the people who supported me first place, when i applied for my DRO it was highlighted that 'if my circumstances don't change, my debts will be cleared', what does that mean exactly. Are they referring to if i win the lottery or something to that effect. Basically in short, i have been given a pay rise at work, nothing extravagant but an extra 50p an hour, would this affect my DRO? . I have until September, when it finishes, and don't know the procedure for finalising it.
Many  thanks 

MissFlossy222

You have to report any increases in your income that result in your surplus income being more than £50 per month, as this means you're no longer eligible.
Assuming you work 40 hours per week, your looking at an increase in your income of around £86 per month. 
That doesn't necessarily mean it's surplus though. I'd suggest looking through your budget and checking if you've underestimated any costs or make adjustments for things that may have increased during the year such as Council Tax.

sallymanton

I only work 34 hours a week, i have had a few increases, like my rent and council tax has gone up, clothes for my son etc, Do you think i should ring stepchange up and go through a budget with them? I don't want it to jeopardise my plan as im settled for the first time in years. 
Thanks 

MissFlossy222

I think its a good idea, if only to put your mind at rest. Updating your budget will highlight increases in your bills that you've overlooked.  I bet your pay rise will soon be swallowed up.

sourcrates

If you get a wage rise, usually you also have an equal rise in outgoings, don’t cut off your nose to spite your face, use common sense, unless your increase is significant, then it’s perfectly acceptable.

Don’t be ringing anybody.

My income rose slightly during the moratorium period, but so did my bills, you are not checked up on, as long as you can justify your budget, if necessary, then carry on under the radar.

There is no procedure, you carry on with life, when September comes, you will be debt free, focus on that.

sallymanton

Yes no doubt it will, more money, but the tax man will take more. Child care will go up in October, as my son starts nursery, but my DRO will be finished then, what's the procedure for finishing the DRO, because the gov website says i am not contacted or anything.
Thanks for your help 

JCS1

50p an hour, less 20% tax, less 12.8% NI, less any pension or student loans  - that increase is soon wiped out by council tax increase etc.

sallymanton

Sourcrates i was waiting for you to reply, as i know you know your stuff.

I think i have just scared myself that my DRO will be revoked just because i am seen as good at my job and appreciated.
I was previously on minimum wage so nothing to write home about, and can justify the increase in bills if needed. I just wanted to follow the book, and wait for September to come then breathe. My baby will be going to nursery in October, i couldn't afford to contribute to bills and pay high nursery fees, would cripple me. 

JCS1 thanks, just needed some reasoning and that seems ok that not much will change 

MalMonroe

Hi, just wanted to add that I agree with sourcrates, your income and outgoings will fluctuate over a year - you got a rise (congratulations, btw) but then your rent/mortgage may also rise or the cost of food and of course, the dreaded council tax bill. 

So they cancel each other out. I'd only report it if you did win the lottery or any other large sums of money came your way (we can dream, can't we?)  I had a DRO a few years ago and didn't even think of reporting any of the small increases I received. Rent and council tax went up too. You'll be fine.

When the DRO ends, there's nothing really, it fizzles out. It stays on the Insolvency Register for three months after it ends and then it drops off there. Of course it stays on your credit report for another five years but that's no big deal, in my experience, if you manage your finances properly - something I didn't do before the DRO but which I do now. 

Here is some info from StepChange about when the DRO ends : https://www.stepchange.org/debt-info/what-happens-after-a-debt-relief-order.aspx

sallymanton

Thank you so very much, makes perfect sense. I was starting to panic it would affect me, in which case I would of refused the increase, silly i know. I have just got in to a routine, and relaxed a bit more, i don't want to ruin that.

I won't report anything then as like you both say that small amount will most likely be taken up anyway, sods law.

I will have a look at the link thanks, stepchange saw me through the application and the in between bit, but not what happens at the end, thanks again for the reassurance. 

gazzabun84

should I inform them if I got a £2000 payout from a work injury from 2 years ago?