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charlie44
Junior Member
231 Posts |
 Posted - 04 May 2010 : 10:46:58
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A friend of mine is going to be made redundant, there is no definite date but it will be in the next 12 months. They were made BR in November and they are worried what percentage if any the OR will take. They were in an IPA but due to personal circumstances this has been cancelled. If she is discharged before the redundancy takes place, what will happen with the money as she knew that this was going to happen whilst she was still BR, although the actual redundancy may not take place until after discharge. Hope this makes sense?
Life`s Tragedy is that we get old too soon
and WISE too late! |
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Bridgewood
Junior Member
United Kingdom
222 Posts |
Posted - 04 May 2010 : 12:22:53
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Hi Charlie
Any money received due to redundancy is not classed as income, it is compensation for losing their job, so wouldn't be claimed under any IPA, but it is possible if that money was used to buy something (e.g. a car) the asset could be claimed as after acquired property.
However, if part of the redundancy package is pay in lieu of notice, or holiday pay, this could be claimed as income.
This only applies if the redundancy is prior to discharge
Hope this helps
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charlie44
Junior Member
231 Posts |
Posted - 04 May 2010 : 12:41:05
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Thanks for the reply, much appreciated
Life`s Tragedy is that we get old too soon
and WISE too late! |
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debtinfo
forum expert
2826 Posts |
Posted - 05 May 2010 : 21:47:27
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Hi charlie, the compensation part can be claimed by the trustee if it is paid or becomes due prior to discharge, see below
30.116 Redundancy payments
(Amended March 2010)
The right to receive a redundancy payment that exists at the date of the bankruptcy order, and has not been paid, does not vest in the official receiver, as trustee, as it is personal to the bankrupt. Any redundancy monies paid after the bankruptcy order has been made but before the date of discharge may be claimed as after acquired property and should not be treated as income (see paragraph 30.111). The trustee must make a claim to after acquired property within 42 days of becoming aware of that property [note 12, 13]. The official receiver must be satisfied that the amount claimed as after acquired property does not include any amount payable in respect of wages which should be regarded as income and be taken into consideration in respect of any IPA/IPO. See Chapter 76, paragraph 76.40 and Chapter 31.8, paragraph 31.8.3.
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Bridgewood
Junior Member
United Kingdom
222 Posts |
Posted - 06 May 2010 : 09:00:24
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Clearly this is not as clear as it appears as the paragraph 30.111 referred to states:-
The official receiver, as trustee, does not have the right to intercept the monies awarded before they are paid to the bankrupt or when the bankrupt receives the monies in a bank account. The bankrupt is entitled to use the monies for maintenance of him/herself and his/her family. If the bankrupt leaves the monies in a bank account until discharge, then the trustee cannot claim them. On the other hand if the monies change character, for example they are used to purchase a vehicle or shares, then the asset purchased with the monies may be claimed
Which is what my original reply was based on
Bridgewood specialise in helping people deal with their debts and make the most of their financial situation - providing free, no obligation debt advice.
We can also setup a complete range of solutions including debt management plans, IVA and bankruptcy support. |
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REDUNDANCY
