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I was discharged from my bankruptcy March this year and received a letter from my Trustee demanding £70 a month.


Questions -


Should I be including Tax Credits and Disability living allowance in my income and expenditure sheet?


Is the Trustee allowed to set up an IPA after discharge? He has written that I should pay for the next 36 months - but surely they are only allowed to set up an IPA during my bankruptcy and it cannot be fore more than 36 months after the date of discharge?


The way he has written his letter suggests that I will be paying into an IPA for nearly five years after my original date of bankruptcy.


Here is what he wrote:



After a detailed review of your income and expenditure statement I note that you have £137 per month disposable income available from your salary (made up from pub/outings £50, hobbies £40 and contingency £47).


As your income payments agreement is still in force, a copy is enclosed for ease of reference, I would request that you pay £68.50 per month for the next 36 months into your Bankruptcy estate.


The monthly amount has been calculated using the official receiver's disposable income scale:


Between £100 and £240 pcm disposable income = Take 50%


Please find enclosed a Standing Order Mandate which I would be grateful if you could complete, sign and return as soon as possible.


I look forward to hearing from you within the next seven days.


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Yes an IPA was set up at the time I declared myself bankrupt, which was then stopped because I lost my job.


I am now working again but only part time.


I only have surplus income because of means tested benefits, if they are not included then there is a several hundred pound monthly deficit.


Should I be stolid and stand my ground that they shouldn't be taking these benefits into consideration, or should I be concerned that they are allowed to under certain circumstances?


Help appreciated.

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They are allowed to take them into consideration which means that you do have a surplus. However they can only collect an IPA for 36 months from the start date of the IPA. Therefore it should only be for the remaining months, 19 months or so and the agreement should state this. I would ring them and point this out and ask them to send a new agreement.

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So in Bankruptcy the provisions of the Social Security Act 1992 and Tax Benefits Act 2002 don't apply?


Are you sure about this?


It was my understanding that these benefits are considered by the government as "required to live" and this is why the Social Security Act and Tax Benefits Act prohibit a charge being made on such benefits?


Anyway I've just moved out of my parents house into rented accommodation and even with these benefits I have a nearly-zero surplus, unless the official receiver tells me that I am not allowed to be a student and pay course fees... Can he do that?

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Hi Izools, Those acts do apply, the way the IPA is calculated is that the benefits go to pay the household outgoings first and therefore the surplus they take is taken out of the earned income only, This happens with every IPA. If your income was from benefits only, they would not be able to take anything no matter how large the surplus

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Right I see, that clarifies that one then thank you very much!


Now I just have to wait and see if they want me to cancel my education because it isn't considered "essential"...


...That would be one for the papers I can tell you!

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