Bankruptcy with a "good" income

beeteecee

Hello,

I am probably going to file for bankruptcy once my tenancy agreement is renewed in a couple of months.
My issue is, I am self-employed and have what would probably be considered a "good" income, but as I'm self-employed it's not always regular, I can have a £6000 month followed by a £2000 month - how does this work with an IPA? I'm almost certainly going to have one so I just wonder how they set it or work it out...

Thanks for any advice, trying to prepare myself and not have a full breakdown or similar...

stu12345_2

see section 35.15,  and 35.16 ,the regulator rules when you go bankrupt , what your allowed and not allowed etc.

and how he works out self employed wages average 

https://www.gov.uk/guidance/technical-guidance-for-official-receivers/35-income-payment-agreements-and-orders#:~:text=35.15 Agreeing an IPA where the bankrupt is self-employed&text=This may be done in,receipt of a regular wage.

the whole guide is excellent, scroll right to bottom to see the ins and outs of the conditions etc

beeteecee

stu12345_2 said:

see section 35.15,  and 35.16 ,the regulator rules when you go bankrupt , what your allowed and not allowed etc.

and how he works out self employed wages average 

https://www.gov.uk/guidance/technical-guidance-for-official-receivers/35-income-payment-agreements-and-orders#:~:text=35.15 Agreeing an IPA where the bankrupt is self-employed&text=This may be done in,receipt of a regular wage.

the whole guide is excellent, scroll right to bottom to see the ins and outs of the conditions etc

This is really helpful thank you - god I'm dreading the whole thing, it's absolutely terrifying enough without finding yet more issues. I wish I'd never decided self-employment was the way forward but I've no chance at getting a "normal" job now.

The idea of being regularly contacted and looked into for years is just awful but I suppose that's the price to pay for messing up so badly...and it's a max of 4 years of this isn't it? 1 year bankruptcy + 3 years IPA? 

Thanks again for your insights, I need to just press the button I think. 

la531983

beeteecee said:

stu12345_2 said:

see section 35.15,  and 35.16 ,the regulator rules when you go bankrupt , what your allowed and not allowed etc.

and how he works out self employed wages average 

https://www.gov.uk/guidance/technical-guidance-for-official-receivers/35-income-payment-agreements-and-orders#:~:text=35.15 Agreeing an IPA where the bankrupt is self-employed&text=This may be done in,receipt of a regular wage.

the whole guide is excellent, scroll right to bottom to see the ins and outs of the conditions etc

This is really helpful thank you - god I'm dreading the whole thing, it's absolutely terrifying enough without finding yet more issues. I wish I'd never decided self-employment was the way forward but I've no chance at getting a "normal" job now.

The idea of being regularly contacted and looked into for years is just awful but I suppose that's the price to pay for messing up so badly...and it's a max of 4 years of this isn't it? 1 year bankruptcy + 3 years IPA? 

Thanks again for your insights, I need to just press the button I think. 

No, the one year and three year periods run side by side, well in theory it does, may take a couple of months for the IPA to be sorted but they dont wait until the end of Year One to start taking those payment off you.

beeteecee

la531983 said:

No, the one year and three year periods run side by side, well in theory it does, may take a couple of months for the IPA to be sorted but they dont wait until the end of Year One to start taking those payment off you.

This is positive thank you - the whole thing is just so sickening I just need to get it done...I'm so worried about things like losing our home, the car, everything really but we can't go on like this.

Thanks so much for your reply. 

sourcrates

beeteecee said:

la531983 said:

No, the one year and three year periods run side by side, well in theory it does, may take a couple of months for the IPA to be sorted but they dont wait until the end of Year One to start taking those payment off you.

This is positive thank you - the whole thing is just so sickening I just need to get it done...I'm so worried about things like losing our home, the car, everything really but we can't go on like this.

Thanks so much for your reply. 

Err, are you a homeowner?

Not a good idea to go bankrupt if you are.

beeteecee

sourcrates said:

Err, are you a homeowner?

Not a good idea to go bankrupt if you are.

Nope it's a rental but there's mixed commentary on whether they'll speak to the landlord and I have no clue how they'd feel about it and don't know well enough to pre-warn, with 5 dependent children it's not easy to find alternative accommodation quickly if the worst happens...

sourcrates

If the landlord is not one of your creditors, under what mechanism would the OR speak to them?

There is such a thing as GDPR, (data protection) its none of the landlords business, so long as the rent is up to date, if they wanted to check your status, that`s up to them, but the OR isn`t going to break data protection laws and tell them.

beeteecee

sourcrates said:

If the landlord is not one of your creditors, under what mechanism would the OR speak to them?

There is such a thing as GDPR, (data protection) its none of the landlords business, so long as the rent is up to date, if they wanted to check your status, that`s up to them, but the OR isn`t going to break data protection laws and tell them.

I think I'm getting forum panic or something, I read a thread on here where two people mentioned their landlords had been contacted to get their tenancy agreements so worried this might happen to me. I'm just worrying about absolutely everything to be honest. Thanks for this though - I'm catastrophising as per. 

TripleH

Sorry for commenting on an old post, If you are self employed, I would keep a track of your income and business expenses throughout the year. So you have evidence of how much you earn vs how much you spend by month.

Nothing sophisticated, a spreadsheet will be fine. It makes it easier to warn if there is a sudden fluctuation in business, can help with budgeting now and in the future and will help you if you need to try to renegotiate with the OR.

beeteecee

TripleH said:

Sorry for commenting on an old post, If you are self employed, I would keep a track of your income and business expenses throughout the year. So you have evidence of how much you earn vs how much you spend by month.

Nothing sophisticated, a spreadsheet will be fine. It makes it easier to warn if there is a sudden fluctuation in business, can help with budgeting now and in the future and will help you if you need to try to renegotiate with the OR.

Thanks for your comment this is really helpful. I put my "income" from my work into a spreadsheet for my accountant but have never managed tracking spending well...probably why I'm in such a scary position at the moment and still just don't know what to do or when to pull the trigger. I keep thinking I'll wait for the HMRC to 'catch me' but then...do I look even worse for this? Appreciate your reply and will try to get myself in order somehow .