Good morning I hope you are all doing well despite the current corona virus situation!
Im a wee bit confused about Tax refunds counting as windfalls or additional assets.
Lonf story short I had to leave my pre job in June last year due to ill health but since had an op and started a new job last Dec, however I checked my wage slip which showed I was on emergency tax and so I called up HMRC to rectify it however they informed me that my tax code for my prev job was incorrect ( news to me but HMRC checked while I was on the phone and said it was incorrect ) hence Im getting a tax refund in my wages.
Thus it is a tax refund for the current tax year (2020/2021) amounting to roughly £1,156
Now I have informed my IP about this but this is where my confusion starts, will the IP take the whole lot or 50%?
The only reason I ask is that my only means of transport ( 125 motorcycle ) is on its last legs and I was going to buy a bigger bike to go to & from work on with the tax refund, especially since I do unsociable hours shifts so public transport is not an option. I have found one which is 2nd hand & usuable, with deliverey its £850 ( its located 152 miles away from where I live )
Would it be worth me asking my IP if I could keep £850 of the tax return to faciliate getting the bike or do you think the IP will expect the whole lot regardless?
If I'm allowed to keep 50% of the rebate it would help me out a fair chunk but I want to be able to have an idea of what to expect and have contingincies for worst case scenario.
I am afraid that one thing I have learned, over the last 10 years or so, is that IVAs and the way some clauses and terms are treated is very inconsistent (and becomimg more so)! Some firms will treat it as extra income (which it is) and take 50%. Others will treat it as an unexpected lump sum (which it is) and grab the whole lot as a windfall and some, I suspect, will alter their view according to the amount ( Under £500 a windfall is all yours, so they might then treat it as extra income to at least get half!! ). A few times I have seen tax rebates ignored totally.
The best thing would be to check it out with your IP direct (preferably get the response in writing). There would be no harm, if it goes the wrong way to ask about funding the bike as an investment in a more secure arrangement going foward.
My opinions are merely that .. opinions based on experience. Always seek professional advice.
IVA Completed 23rd July 2013 .... C.C. 10th January 2014
Creditors / IP could look at funding the bigger bike as an investment, of sorts ---- making getting to work more reliable for you --- no reliable transport = no income = failed IVA. Alternatively, if they do insist on taking the rebate into the IVA, you might be able to negotiate a couple of months payment break to fund the new bike (this would be tacked back on at the end of the IVA).
My opinions are merely that .. opinions based on experience. Always seek professional advice.
IVA Completed 23rd July 2013 .... C.C. 10th January 2014
