Shopping & Style1 min ago
bankruptcy
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my partner declared himself bankrupt in may with personal debts. he was told no further action was to be taken as he had no assets. he has recieved a letter for HM.Revenue and Custon saying his tax code has changed and for the next year will pay no tax. can anyone explain the reason for this and what happens now?
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This should have been explained to him by the Official Receiver, and he should have been sent an Income Payments Agreement form to sign about it.
In the tax year in which someone becomes bankrupt their tax code is altered to a nil tax code and they receive their pay without any tax being deducted. However, they do not get to keep this "windfall". The amount of tax which would have been deducted has to be paid each month to the OIfficial Receiver (or Trustee if one has been appointed).
If your partner has not had any information about this from the OR he should contact them so the arrangements for the money to be paid over can be set up. He must not just keep the money.
In the tax year in which someone becomes bankrupt their tax code is altered to a nil tax code and they receive their pay without any tax being deducted. However, they do not get to keep this "windfall". The amount of tax which would have been deducted has to be paid each month to the OIfficial Receiver (or Trustee if one has been appointed).
If your partner has not had any information about this from the OR he should contact them so the arrangements for the money to be paid over can be set up. He must not just keep the money.
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