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  • FIRST POST
    • sortingmyshitout
    • By sortingmyshitout 16th Apr 18, 9:45 AM
    • 25Posts
    • 2Thanks
    sortingmyshitout
    How much of any extra income should be paid to an IPA - ALL of it..?
    • #1
    • 16th Apr 18, 9:45 AM
    How much of any extra income should be paid to an IPA - ALL of it..? 16th Apr 18 at 9:45 AM
    I'm self-employed and just started my three year IPA, in which the OR and I have agreed I pay about 250 a month.

    I know that during bankruptcy my assets are their assets, so if a relative died and I inherited 10,000 I'd give all of that to my IPA to help pay off my (larger than 10k!) debt, correct? I'm completely fine with that, I think that's fair.

    What if I secured a contract with a new client for 10,000? Is it expected that ALL of that go to my IPA?

    I completely understand that I owe money and what's mine is theirs, and I think it's "fair" that all of that money SHOULD go to my IPA...

    ...but if it does, what incentive do I have as a self-employed to go out and pitch to and win new clients?

    I feel it'd be in the OR's interest to take a portion of the money,even if that portion was (say) 90%. If they want 100% then they're probably doing themselves out of money as bankrupt individuals are unlikely to want to work harder to maximise their earning potential?
Page 1
    • maxmycardagain
    • By maxmycardagain 16th Apr 18, 10:07 AM
    • 4,710 Posts
    • 3,752 Thanks
    maxmycardagain
    • #2
    • 16th Apr 18, 10:07 AM
    • #2
    • 16th Apr 18, 10:07 AM
    i too would like to know what % of excess income the IS take from a bankrupt? i know someone on the cusp of going BR who is right now on benefits (UC) and there seems little incentive in finding a full time PAYE job only to have 3 years of working for (say) 10% of any excess income, the naysayers will cite the moral duty to pay the debts in BR but the BR is paying 600 in fees, a 3 year lead necklace (2 more than bankruptcy) on top of 6 years credit reference black-balling seems a tad harsh
    Dont worry, be happy
    • maxmycardagain
    • By maxmycardagain 16th Apr 18, 10:11 AM
    • 4,710 Posts
    • 3,752 Thanks
    maxmycardagain
    • #3
    • 16th Apr 18, 10:11 AM
    • #3
    • 16th Apr 18, 10:11 AM
    I'm self-employed and just started my three year IPA, in which the OR and I have agreed I pay about 250 a month.

    I know that during bankruptcy my assets are their assets, so if a relative died and I inherited 10,000 I'd give all of that to my IPA to help pay off my (larger than 10k!) debt, correct? I'm completely fine with that, I think that's fair.

    What if I secured a contract with a new client for 10,000? Is it expected that ALL of that go to my IPA?

    I completely understand that I owe money and what's mine is theirs, and I think it's "fair" that all of that money SHOULD go to my IPA...

    ...but if it does, what incentive do I have as a self-employed to go out and pitch to and win new clients?

    I feel it'd be in the OR's interest to take a portion of the money,even if that portion was (say) 90%. If they want 100% then they're probably doing themselves out of money as bankrupt individuals are unlikely to want to work harder to maximise their earning potential?
    Originally posted by sortingmyshitout
    makes you want to work cash in hand doesnt it......
    Dont worry, be happy
    • silvercar
    • By silvercar 16th Apr 18, 10:49 AM
    • 38,275 Posts
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    silvercar
    • #4
    • 16th Apr 18, 10:49 AM
    • #4
    • 16th Apr 18, 10:49 AM
    ...but if it does, what incentive do I have as a self-employed to go out and pitch to and win new clients?
    Use the time to get your head in a better place.

    As far as work is concerned, use the time to set the business up to exploit new opportunities in a year's time, expand your network, investigate new opportunities etc
    Depending on your work, this may be a time for "loss leaders" ie no profit made for the OR to take while your name/ business gains reputation instead of earnings.
    • silvercar
    • By silvercar 16th Apr 18, 10:50 AM
    • 38,275 Posts
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    silvercar
    • #5
    • 16th Apr 18, 10:50 AM
    • #5
    • 16th Apr 18, 10:50 AM
    makes you want to work cash in hand doesnt it......
    Originally posted by maxmycardagain
    Or delay invoicing/ income streams.

    Any change in income needs to be reported within 3 weeks....so money needs to arrive (because until it does, you have no change) at least 49 weeks from bankruptcy.
    • sortingmyshitout
    • By sortingmyshitout 16th Apr 18, 10:51 AM
    • 25 Posts
    • 2 Thanks
    sortingmyshitout
    • #6
    • 16th Apr 18, 10:51 AM
    • #6
    • 16th Apr 18, 10:51 AM
    Use the time to get your head in a better place.

    As far as work is concerned, use the time to set the business up to exploit new opportunities in a year's time, expand your network, investigate new opportunities etc
    Depending on your work, this may be a time for "loss leaders" ie no profit made for the OR to take while your name/ business gains reputation instead of earnings.
    Originally posted by silvercar
    If it was just a year I'd be game for all of that, but my IPA is THREE years. I definitely thought when I entered into bankruptcy it would be one year, I'm sure that's what my research had told me, but no, my 250/month IPA is for 3 years, not 1 year :-(
    • luvchocolate
    • By luvchocolate 16th Apr 18, 1:39 PM
    • 1,686 Posts
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    luvchocolate
    • #7
    • 16th Apr 18, 1:39 PM
    • #7
    • 16th Apr 18, 1:39 PM
    Hi an I.P.A does in this country at least lasts for 3 years, and that is the information we give on here.
    B.R is for one one year after that you are automatically discharged maybe that is where you got mixed up.
    Any surplus of 20 or over can be taken in an I.P.A thats 100% of the surplus you do not get to keep the 20.
    This is why many people take this time to re train or stop working overtime as there is no point in working for nothing.
    Very important we see the S.O.E so we can help to make sure everything is covered.
    • sortingmyshitout
    • By sortingmyshitout 16th Apr 18, 1:45 PM
    • 25 Posts
    • 2 Thanks
    sortingmyshitout
    • #8
    • 16th Apr 18, 1:45 PM
    • #8
    • 16th Apr 18, 1:45 PM
    What's an SOE?
    • maxmycardagain
    • By maxmycardagain 16th Apr 18, 1:54 PM
    • 4,710 Posts
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    maxmycardagain
    • #9
    • 16th Apr 18, 1:54 PM
    • #9
    • 16th Apr 18, 1:54 PM
    Or delay invoicing/ income streams.

    Any change in income needs to be reported within 3 weeks....so money needs to arrive (because until it does, you have no change) at least 49 weeks from bankruptcy.
    Originally posted by silvercar
    or work overseas
    Dont worry, be happy
    • sortingmyshitout
    • By sortingmyshitout 16th Apr 18, 2:14 PM
    • 25 Posts
    • 2 Thanks
    sortingmyshitout
    or work overseas
    Originally posted by maxmycardagain
    I assume that's just a tongue-in-cheek response, they'd have as much claim to that income, providing you told them about it?
    • luvchocolate
    • By luvchocolate 16th Apr 18, 4:33 PM
    • 1,686 Posts
    • 1,522 Thanks
    luvchocolate
    What's an SOE?
    Originally posted by sortingmyshitout
    Hi again sorry I meant S.O.A statement of affairs....not earnings been to dentist and a bit groggy!!
    • silvercar
    • By silvercar 16th Apr 18, 5:29 PM
    • 38,275 Posts
    • 160,908 Thanks
    silvercar
    If it was just a year I'd be game for all of that, but my IPA is THREE years. I definitely thought when I entered into bankruptcy it would be one year, I'm sure that's what my research had told me, but no, my 250/month IPA is for 3 years, not 1 year :-(
    Originally posted by sortingmyshitout
    Sorry, I was thinking you wanted to avoid an IPA from the start, as a new bankrupt. For people who manage to initially avoid an IPA, they only have one year to wait before their income is their own.
    • TheGardener
    • By TheGardener 16th Apr 18, 6:47 PM
    • 2,495 Posts
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    TheGardener
    If I were in business - particularly if I was rebuilding that business and a new contract meant that the business had a much better chance of survival due to the investment in the business that the new contract would facilitate - I would be working on a business case I could present to the OR as part of the negotiation. In the business case I would be making a strong case for the re-investment of as much of the extra money as possible. Obviously the OR will want some of it - but if the investment meant that you could pay a slightly higher IPA over the remaining duration of the IPA rather than give up all of a lump sum - then with proper planning and a clear business plan - the OR might be willing to negotiate.
    • LincsPaul
    • By LincsPaul 17th Apr 18, 12:11 PM
    • 131 Posts
    • 66 Thanks
    LincsPaul
    Yes, as above I would seek to reinvest the money in the business so it doesn't show as much profit. Your personal income is the profit surely, not the actual income of the business. Win some new contracts and then spend the money on a nice new website, app, advertising or tools? How you run your company is your business and the OR shouldn't expect lots of money from a bankrupt self-employed person.

    I'm surprised you signed an IPA personally since 250 a month isn't all the money in the world if you have your own business to run, and I'd have thought you could have used creative accounting practices to adjust your business income and expenditure to circa 100 profit a month (and then refuse to sign the IPA - they won't take you to court for that amount).
    • sortingmyshitout
    • By sortingmyshitout 17th Apr 18, 1:38 PM
    • 25 Posts
    • 2 Thanks
    sortingmyshitout
    I'm surprised you signed an IPA personally since 250 a month isn't all the money in the world if you have your own business to run, and I'd have thought you could have used creative accounting practices to adjust your business income and expenditure to circa 100 profit a month (and then refuse to sign the IPA - they won't take you to court for that amount).
    Originally posted by LincsPaul
    I guess I should have read more, I didn't really think I had a choice in the matter. That being said, I wouldn't have wanted to use "creative" accounting practices in something that could have results in me having a BRO/BRU levied against me. I'd like to be discharged in 12 months, not x years!

    My wife also earns very handsomly compared to myself, so I felt a bit like I was treading on eggshells and blindly agreed to most things, just happy that they weren't saying "hey, why don't you get your wife to pay off all of your pre-marital debts?"

    My business expenditure costs to this point have been very low though. I work from home and run a website, so my only obvious overhead is the servers the site runs on.

    Going forwards though, yes, I imagine I'll be putting a lot more money back into the site in various ways, promotion etc!
    • TheGardener
    • By TheGardener 17th Apr 18, 4:14 PM
    • 2,495 Posts
    • 2,436 Thanks
    TheGardener
    You can ask the OR to reassess your IAP at any time if you believe that there has been a change in your circumstances - no debt collector nor the OR could have asked your partner to pay your debts.
    Once you have done maybe 3-6 months of your IPA - sit down and look again at that you are being asked to pay and double check that you are making the minimum contribution - an SOA on here might get you some advice on how to reduce the IPA.
    • sortingmyshitout
    • By sortingmyshitout 17th Apr 18, 6:12 PM
    • 25 Posts
    • 2 Thanks
    sortingmyshitout
    I assume an SOA can also be changed, not just one's income amount. Probably tough to *increase* the expenditure in an SOA though, I'm guessing?
    • TheGardener
    • By TheGardener 17th Apr 18, 8:03 PM
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    TheGardener
    I assume an SOA can also be changed, not just one's income amount. Probably tough to *increase* the expenditure in an SOA though, I'm guessing?
    Originally posted by sortingmyshitout
    If you believe the SOA was not truly reflective of your overheads - then you can ask for a review. Did you say you were paying 50% of your domestic bills ? Peoples circumstances change for better and worse.
    • Tarambor
    • By Tarambor 18th Apr 18, 1:38 AM
    • 3,940 Posts
    • 2,980 Thanks
    Tarambor
    i know someone on the cusp of going BR who is right now on benefits (UC) and there seems little incentive in finding a full time PAYE job only to have 3 years of working for (say) 10% of any excess income
    Originally posted by maxmycardagain
    Well if you don't look for work your unemployment benefit will be sanctioned. You'll lose 3 years of workplace pension contributions and many employers won't be interested in employing someone who hasn't worked for 3 years other than in really crappy jobs nobody else wants to do.
    • silvercar
    • By silvercar 18th Apr 18, 8:45 AM
    • 38,275 Posts
    • 160,908 Thanks
    silvercar
    Well if you don't look for work your unemployment benefit will be sanctioned. You'll lose 3 years of workplace pension contributions and many employers won't be interested in employing someone who hasn't worked for 3 years other than in really crappy jobs nobody else wants to do.
    Originally posted by Tarambor
    If you don't have an IPA to start, you would only need 1 year (not 3) of looking for work before you could earn without risking an IPA.

    I imagine that there are ways of looking for work that would keep yourself under the radar of benefit sanctions.

    Your post does come over as disrespectful to those who do "jobs nobody else wants to do", without which the country wouldn't function.
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