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    • Balderdashandpiffle
    • By Balderdashandpiffle 7th Mar 18, 1:04 PM
    • 2Posts
    • 0Thanks
    Bankruptcy agreed Feb. O.R assessment query
    • #1
    • 7th Mar 18, 1:04 PM
    Bankruptcy agreed Feb. O.R assessment query 7th Mar 18 at 1:04 PM
    Hi All,

    I wonder if anyone may be able to help with this.

    I recently applied for bankruptcy which has been agreed, I am waiting for assessment to be completed by the official receiver.

    I have had an initial telephone conversation with the O.R who queried whether my wife had any outgoings of her own separate from the household budget (i.e credit card etc). I presume this is related to proportional income/expenditure and may impact whether an IPA is put in place.

    The information in my bankruptcy application is as follows:

    Net income 1948.94
    Income Tax 214.06
    Other 150.00

    I included child benefit as income however this is solely in my wife's name on checking which O.R asked for clarification on.


    Child benefit - 149.07

    Additional Household income:

    Stat Maternity pay - 610

    Total income - 2858.01

    Total expenditure 2857.88

    Home and utilities total - 931.56

    Rent - 600
    Insurance - 6.12
    Tv licence - 12.12
    Council Tax - 179
    Gas - 75.67
    Electricity 26.65
    Water - 32

    Pension insurance and Health Care 30

    Dentist 20 (underestimated this to be honest as need at least 3 fillings currently)
    Opticians 10

    Food and Housekeeping 590
    Groceries 500
    Toiletries 25
    Meals at Work 15

    Transport and Travel 497.32
    car insurance 41.51
    car tax 25.81
    mot etc 30
    Fuel etc 400

    Childcare and Maintenance 270
    Childcare costs 140
    Nappies and baby items 130

    Personal and Leisure 340
    Clothing etc 50
    Hairdressing 30
    Home phone, net, tv 50
    Mobile 80
    Hobbies/leisure 45
    Newspapers, mags etc 20
    Smoking 65

    Savings fines etc 199
    Student Loan 169 (will be completed before bankruptcy discharged).
    Emergencies/sundries 30.

    Household expenses are for a family of 4, 2 adults and 2 children under 3.

    My wife does have her own credit card and we do have an additional expense of fuel for a second car which is used by my wife solely (taking child to childcare wife has a slipped disc requiring surgery so public transport not a real option).

    My query really is with these figures would an IPA be made? I have not included wifes credit card cost as in her name but this has been requested by O.R to complete assessment, not sure what impact of this would be on figures --- as can see from budget/application figures no spare money.

    The O.R was discussing proportional payments which went over my head a bit.

    Secondary query - currently cant afford to pay into workplace pension - would that be possible when student loan paid off although bankruptcy would not be discharged at that point?

    Thanks in advance for any help/advice.
Page 1
    • LincsPaul
    • By LincsPaul 11th Mar 18, 1:49 PM
    • 131 Posts
    • 66 Thanks
    • #2
    • 11th Mar 18, 1:49 PM
    • #2
    • 11th Mar 18, 1:49 PM
    The proportion thing is simply, if your wife's income is 10k a year and yours 30k a year then all household bills will be split 25/75%. Both income and expenditure will need to be divided up. You might get lucky and find that the child benefit in your wife's name is taken off your income and added to hers, but remember that her share of the bills will increase, and yours decrease, as a result.

    I think the OR may query a couple of things in your SOA: fuel (that's a lot per month); mobile (is this for 2 people?!), hobbies/leisure/newspapers (may be cut), smoking (kiss that bye bye - not allowable).

    At the same time, try and increase the dentist and split the emergencies and sundries - remember you occasionally need to buy domestic items like new kettles etc. Try at least 20 each. Add a holiday fund of 20 too.

    The pension thing is tricky. I thought they would allow a minimum contribution to a workplace pension.. however the official manual suggests it's at their discretion:

    31.7.109 Contributions to a pension or SAYE scheme

    The official receiver should examine closely any deductions at source from earnings and consider whether payments or over payments into a pension scheme should be disallowed, as this is not an essential outgoing required to meet the reasonable needs of the bankrupt. In most cases an individual can elect to stop or reduce their contributions to a personal pension for a period of time. Whilst the bankrupt may argue this will have the effect of reducing future income, the official receiver should explain that the cost of maintaining his/her future income should not be made at the expense of his/her creditors. In the same way where the employer operates a SAYE saving scheme (where a proportion of the bankrupt!!!8217;s income is deducted at source to purchase shares in the employing company), this expenditure should be investigated and disallowed, to ensure that the full amount of income available is included in an income payments calculation.

    Personally I doubt they'd allow you to use up your spare student loan cash to start a workplace pension before the end of BR. But you never know!
    • TheGardener
    • By TheGardener 11th Mar 18, 6:05 PM
    • 2,312 Posts
    • 2,205 Thanks
    • #3
    • 11th Mar 18, 6:05 PM
    • #3
    • 11th Mar 18, 6:05 PM
    The pension - most administrative public sector employees have to pay 6 to 8% of their salary for example so anything in that range is fine. The OR will not accept anything that looks like 'stuffing money down the back of a pension sofa' but some higher risk professions (eg fire fighters) pay in around 16%. Its about what's 'reasonable'. If this is not actually a pension and is basically private healthcare the OR might find it less acceptable.

    No-one can afford NOT to pay into a pension unless they have significant realisable assets and reasonable pension contributions are completely acceptable to the OR (maybe think about not smoking and paying a pension instead...

    Your car fuel is extremely high - is that work related and therefore refunded by your employer? It would be very hard to convince an OR that 400 of fuel a month was essential use unless you live in a very remote part of the country...

    Your personal and leisure is a bit high TBH - I would look to increase the dental and a contact lenses are at least 20 a month and reduce the mags and fags - essential trade papers etc for work might be acceptable

    There is nothing there for parking - even 1 trip to town a month costs me 10 a mth...

    Technically, your leisure spend could in theory include smoking but it won't look good on an SOA...

    What are 'savings fines' ?
    Last edited by TheGardener; 11-03-2018 at 6:08 PM.
  • National Debtline
    • #4
    • 12th Mar 18, 11:09 AM
    • #4
    • 12th Mar 18, 11:09 AM
    Hi Gardener

    What are 'savings fines' ?
    Originally posted by TheGardener

    I'm assuming this was meant by the OP to read "savings/fines etc." as a general catch-all category for any miscellaneous outgoings.

    We work as money advisers for National Debtline and have specific permission from MSE to post to try to help those in debt. Read more information on National Debtline in MSE's Debt Problems: What to do and where to get help guide. If you find you're struggling with debt and need further help try our online advice tool My Money Steps
  • National Debtline
    • #5
    • 12th Mar 18, 11:15 AM
    • #5
    • 12th Mar 18, 11:15 AM
    Hi Balderdashandpiffle

    I'd anticipate the OR wanting to put the squeeze on what you have collectively budgeted for leisure/smoking/newspapers and magazines - in fact most of the items under your "Personal and Leisure" section - although of course it would be up to you how any redetermined figure was actually used.

    My gut feeling is that the OR would be looking for some sort of IPA, but ultimately as others have observed it is at their discretion. Do bear in mind that you reserve the right to query and challenge it.

    We work as money advisers for National Debtline and have specific permission from MSE to post to try to help those in debt. Read more information on National Debtline in MSE's Debt Problems: What to do and where to get help guide. If you find you're struggling with debt and need further help try our online advice tool My Money Steps
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