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worried
Starting Member
27 Posts |
 Posted - 24 October 2009 : 14:32:00
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hi there - my partner is thinking about becoming BR but has some concerns:
1. he owes tax from previous years when he was self employed (total £2800) - can this be included in the BR.
2. we have read on here about a nil tax code during BR - if you dont pay any tax then your income would be higher - so is that included when they look at your disposable income?
3. he pays into an lgps every month in his wages and has done since june this year. will they make him stop paying his pension and does that money become disposable income?
Basically we earn £2000 per month (after pension deduction of £180)between us and our outgoings are £2400. he has the following debts:
credit cards - £25,000
overdraft - £4000
tax owed - £2800
is it better he goes for BR or IVA?
thanks
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Richard P
Senior Member
United Kingdom
1701 Posts |
Posted - 24 October 2009 : 15:25:01
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Hello worried
From thinking about going BR and actually going pop took me about a year, so do not rush into any decision
From personal understanding note not an expert
1) Yes you can include tax Inland Revenue is no longer a preferential creditor and they are all treated equally
2) Nil tax code for the term of BR is so that the OR can collect some money from you, it is not normally collected from your wages but collected by a separate company
3) Each pension is different, you cannot put extra money into scheme to hide money, and there are specific questions that need to be put to Pension Company
That is the big question BR or IVA, I really recommend sitting down with a couple of companies and go with your gut feeling, both have positives and negatives
When you sit down with one of the companies, they will then bring everything into the equation, house, equity, savings, cars, consolidation, current job, earning capacity, children etc
I obtained advice from one of the companies on this site and it has really helped me
Whatever you do, please do not just hide from it as the probs will not go away, well done for posting a help on this site first positive step. The earlier you grasp the problem the easier it is for someone else to offer stepping stones or solutions
Good luck Richard
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gettingoutofdebt
forum expert
2418 Posts |
Posted - 24 October 2009 : 15:33:56
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1. Yes this can be included.
2. If you receive a nil tax code then this amount would need to be paid to the OR rather than to HMRC so this isn't included in your DI.
3. If the pension is deducted at source then I believe the payments can continue.
quote:
Is it better he goes for BR or IVA?
This is something that you should discuss with an Insolvency Practitioner as they will be able to go through your income/expenditure and advise the best option for you. Jones Giles post on this board and are very highly respected so I would recommend contacting them to discuss your situation and options - http://www.jonesgiles.co.uk/ |
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charlie44
Junior Member
231 Posts |
Posted - 24 October 2009 : 16:36:12
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| I totally agree with Gettingoutofdebt, I contacted Jones Giles and spoke to Melanie Nicholas and Susan Clay, and their advice was brilliant and it was all free. If you look on here you will find posts from Melanie. |
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In 2 Deep
Junior Member
United Kingdom
161 Posts |
Posted - 24 October 2009 : 17:08:51
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Worried,
Your tax which will not be deducted at source will collected by a company called Moonbeaver - dont ask. The nill tax code will be in place for the tax year that you go BR - not for the duration of the BR.
As other have stated speak with Melanie and get professional advice.
Gd luck.
quote:
Originally posted by worried
hi there - my partner is thinking about becoming BR but has some concerns:
1. he owes tax from previous years when he was self employed (total £2800) - can this be included in the BR.
2. we have read on here about a nil tax code during BR - if you dont pay any tax then your income would be higher - so is that included when they look at your disposable income?
3. he pays into an lgps every month in his wages and has done since june this year. will they make him stop paying his pension and does that money become disposable income?
Basically we earn £2000 per month (after pension deduction of £180)between us and our outgoings are £2400. he has the following debts:
credit cards - £25,000
overdraft - £4000
tax owed - £2800
is it better he goes for BR or IVA?
thanks
Treat EVERY Penny as a prisoner. |
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worried
Starting Member
27 Posts |
Posted - 31 October 2009 : 07:26:26
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| so, if for example you did not have an ipa because your DI is the same as you earn and then they put you on nill tax code... do they use that tax to pay creditors - is that what you mean? it doesn't become part of your DI? |
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BankruptC
Senior Member
1030 Posts |
Posted - 31 October 2009 : 16:09:05
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Hi worried,
No, it doesn't become part of your DI. It's totally separate. Once the NT code is implemented you have to keep the money to one side that you would have been paying in tax and eventually (!) Moon Beever will get in touch to collect the money. It took them about 5 months to collect it from us-it was burning a hole in our bank account I can tell you! We were very glad when it was collected!
Hope that's clear.
C. x |
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partner is thinking about becoming BR
