OR - How would they ever know??

mclachlan4321

Just a simple question..

How would the OR ever know if a BR had received any form of pay rise or income without having some kind of hunch and making the ffort to dig?

Or are there reporting procedures in place within the system to notify them of any changes?

Waspeze

I'm not sure if there are "procedures" in place but I think they can ask for any documentation whenever they want during BR.

fermi

First of all you are bound under a court order to cooperate with the OR. That includes informing the OR/trustee of any increase in income within 21 days. To not do so would be non-cooperation, and is the sort of thing that could lad you with a BRU/O.

Secondly, HMRC and the OR do share certain information at certain times, but there is not a continual monitoring of HMRC records by the OR.

But the OR will (apparently) be informed of how much you earn for each month at the end of any tax year that you are an undischarged bankrupt in.

Remember, that one one the first forms that you are required to sign when you go BR is the TNIDIS (Tax & National Insurance DISclosure).

Which goes something like this............

To:

The Commissioners of Inland Revenue and Department of Work and Pensions.

I authorise and request you to provide to the Official Receiver (and to any agent appointed by the Official Receiver or any trustee who may be appointed in my bankruptcy) for all the tax years up to and including that in which I am discharged from bankruptcy:

1. copies of my tax returns and any accounts submitted to you;

2. details of;

a) my tax assessments;
b) my national insurance contributions and tax credits;
c) any benefits I have claimed; and

3. any other information about my tax or national insurance affairs, tax credits or benefits which the Official Receiver (or trustee) may require.

I also authorise and request you to pay to the Official Receiver (or any trustee who may be appointed in my bankruptcy) any income tax refunds due to me for all tax years up to and including that in which the bankruptcy order was made against me.

Date


Signed

NekoZombie

I think they can ask for documentation after BR also if you have an IPA. Though I may be wrong...

NekoZombie

Btw, there was the case on another forum of someone who withheld that they were earning more than they had declared. This came out in subsequent investigations that I understand the OR would have pursued as a matter of course (not because they were suspicious). the person in question ended up with a BRO and their IPA was deducted directly from their wages rather than collected through an agency such as Clarke Willmott.

fermi

NekoZombie wrote: »

I think they can ask for documentation after BR also if you have an IPA. Though I may be wrong...

Your duty to cooperate with the OR/trustee continues after discharge, and this certainly falls under that.

Also, while an IPA is a voluntary agreement, the OR/trustee can still apply to the court to vary it if they believe they need to. The court could order you to produce any documentation they require.

EDIT: And as Neko says, the court can require the IPA payments to be deducted at source if necessary.

Cinderbrook

What about, for example, you buy some shares and they increase in value, but you don't sell them and withdraw the money, would this have to be declared to the OR if you weren't benefitting from them as income? The reason I ask is that some friends want to start an investment club starting with a few hundred quids each.
C

maxmycardagain

my lads 15 year old dinky toy batmobile (unused/boxed/signed by batman) is now worth £2000, ill ebay it..........

wherediditallgo

Cinderbrook wrote: »

What about, for example, you buy some shares and they increase in value, but you don't sell them and withdraw the money, would this have to be declared to the OR if you weren't benefitting from them as income? The reason I ask is that some friends want to start an investment club starting with a few hundred quids each.
C

I'd have thought you'd have to tell the OR if they were purchased either before going BR or during it, or during the course of your IPA. Your scenario is no different to buying a house for cash, it increasing in value & either having people living there rent-free or not renting it out at all. You not selling up is from choice, but the value of the item would still be available to you in one form or another. It's different from buying Premium Bonds which don't increase in value, & if you cash them in you get back what you paid for them. Buying shares that have then increased in value mean they've made a change to your circumstances, & that requires that you report it within 21 days. Whether the OR chooses to do something about it is up to them.