BR and Child Tax credits

[fudge34]

Hi
Sorry to keep going on - am going to call the court tomorrow for my BR appointment and my mind keeps chucking in things for me to think about - so this is my question Skippy and Melanie I know you will tell me not to worry but I don't seem able to help it!
I have finally had my child tax credit agreed - this is 136.00 per week towards nursery costs of 200 per week. When I set out my IVA I didn't have this agreed with the Child Tax credit people so myself and husband were paying the 800 quid a month out of our disposable income ourselves. We have been told that this amount (the 136.00) will only be paid until April 2008 when they will reevaluate it.

We are getting more than we thought this year because they take it from what we earnt last year my husband barely brought home 14.000 grand so we have a good payout this year. However next year, we will both be making a claim based on our joint income this year 45.000 so are liable to get very little. I am concerned that by putting this amount, 136.00 on my i and e form for BR means that they will take this amount as coming in over the next three years and that when next year kicks in I shant be able to keep up the payments on my IP.

Obviously when I filled out my IVA form our disposable income was a little over 300 pound give or take a few pence, but now it is going to be alot more with the fact that my child's nursery bills are 3/4 paid. What shall I do? I don't want to put this down as fixed income because it will change (I have the letter from the Child Tax people saying that in 2008 they estimate our payments will be 10.00 per week) but at the same time I know I cannot leave it out!
Help me before i go mad!

[MelanieGiles]

You just need to advise the OR if your circumstances change, and they will agree to a reduction in the payments. This of course assumes that you are awarded an IPO in the first place!

Regards, Melanie Giles, Insolvency Practitioner for over 20 years.

For further details contact me at http://www.melaniegiles.com and view my IVA blog at: http://melaniegiles.blogs.iva.co.uk

[fudge34]

Thanks Melanie you are like a Florence Nightingale of the debt world - you know what i mean! I am pretty sure they will want me to pay it back to be honest, have steeled myself for that fact, I have at the moment, taking into account this new increase in child tax credits around 500 spare disposable income shared with my husband's income obviously (although I need to increase my clothing as I only put down 50 pounds per month on my IVA form as I didn't take into account my daughter who is two and growing rapidly even Clarkes shoes cost 30 quid these days!) so I am thinking that they will want me to pay back at least 200 or 300 pound every single month but compared to the 800 pounds I am trying to find for all my loans / debt it seems quite small fry!

[MelanieGiles]

Make sure you provide for all know contingencies - school uniforms and kitting them out with books and stationery each year, I gather holiday funds are now allowable, miscellaneous expenditure, house and car maintenance and medical expenses. Also with regard to school and educational expenditure, if your children attend after school clubs, have dance, drama or music lessons, or partake in sport there may be additional expenditure. Brownies or Cubs subscriptions and school trips - they all add up.

With payments of £200-£300 per month, it is unlikely that much of this (if any) will eventually be paid back to creditors, so do make sure you fully provide for your families needs. If the OR feels that you are overspending he/she will tell you so, but on the whole the allowances in bankruptcy appear to be quite generous these days.

Regards, Melanie Giles, Insolvency Practitioner for over 20 years.

For further details contact me at http://www.melaniegiles.com and view my IVA blog at: http://melaniegiles.blogs.iva.co.uk

[fudge34]

Thanks Melanine - I forget that I have to forsee into the future a bit - my daughter is two but in three years time she will of course have all the after school activities, and school uniform etc, I just don't want to get anything wrong or be too greedy in my i and e and make the OR think that I am trying to scam the system - again I am estimating the 200 / 300 pound per month as I am not sure what the OR will want / expect me to pay back - I am looking at 50% of my disposable income which I have been researching on the net seems to be the average that they ask you for - going by what my IVA also said about if I went BR they could only expect 6p in the pound rather than the 56p I was proposing to NR - I am dreading them telling me that they want me to pay something back like the whole of my disposable income as that would break the fact I want to pay back my husband the loan he is going to need to take out to buy me out of my BI now - we have decided that its easier for him to buy me out now rather than wait for a whole year obviously will be asking the OR when I go BR hopefully in three weeks if that is possible!

[MelanieGiles]

Make sure you keep us informed of what happens - it is great market research for IPs like me to know what goes on in the OR's office, so that we can advise our clients appropriately.

Regards, Melanie Giles, Insolvency Practitioner for over 20 years.

For further details contact me at http://www.melaniegiles.com and view my IVA blog at: http://melaniegiles.blogs.iva.co.uk

[fudge34]

Of course I will its the least I can do!
Still wish you could be my OR - I have at least twenty left in the bank until payday (next Friday) sure I cannot tempt you?!
on a more serious note will make sure i note down everything in i and e - will also make sure i get an indepth answer to the equity in joint mortgages as I think that comes up quite a bit.

[Skippy]

Hi Fudge, don't worry, you won't be asked to pay back all your disposable income. I have to pay back 60% of mine, and I have posted a table on my blog to give you a rough idea of what you can expect to pay. When you do you I & E, make sure you account for everything you spend - don't exaggerate, but don't leave yourself short. While you won't live a life of luxury in BR, you should be able to have a reasonable standard of living.

Yesterday is history, tomorrow is a mystery, today is the present - a gift to make the most of.

View my blog at http://skippy13.blogs.iva.co.uk/

[fudge34]

thanks skippy am now sending you a virtual gin and tonic for all the help you have given me ... have you got it yet?
am going to sit down and do a proper i and e tommorrow so I can make sure that I don't go overboard but at the same time as Melanie said making sure its realistic as it is for the next three years and my littl girl will start school in two years perish the thought!

[Skippy]

Got it? I've drunk it! I really don't mind helping, although it's only my experience as each OR seems to be different. You will be ok, although I really do understand how hard it is. I can't believe I'm nearly 5 months in now - it's going very quickly!

Yesterday is history, tomorrow is a mystery, today is the present - a gift to make the most of.

View my blog at http://skippy13.blogs.iva.co.uk/

[pippa]

Skippy

When did you discuss your I&E with the OR was this done during the telephone interview? did they give you an idea there and then if you would be paying an IPA or did this come later on down the road. Also did they add anything to your expenditure that they thought you had not put down?? Have mine tuesday, just wondering before hand

Thanks

Pippa