If you are applying for Sequestration (Bankruptcy) in Scotland you will need to complete a monthly living expenditure budget as part of your application. This is a list of all of the reasonable living expenses that you incur every month.
It is very important to get this budget right because the expenses you record in your application will be used by your Bankruptcy Trustee to work out whether or not you can afford to make a monthly payment towards your debts.
If you underestimate the amount you spend on any of your regular living expenses or miss some expenses out completely your total budget will be too low. Then when this is deducted from your income the amount left (your disposable income) will be too high and your Trustee will ask you to pay more than you actually can afford.
BMD Tip: If you are asked to make payments which you cannot afford because they are based on a disposable income figure which is too high you must speak to your Trustee and explain that you need to submit a revised expenses budget based on more accurate figures.
How to get the Sequestration Living Expenses Guide
To get an accurate view of which types of living expenses are reasonable and to make sure that you include all allowable expenses in your budget you should get a copy of the Beat My Debt living expenses guide.
The guide lists all of the different types of expenditures you should consider when completing your monthly budget together with hints and tips about the budgets which you will have to stay within to ensure that they are acceptable to the Official Receiver.
To get the guide please use the “Download Living Expenses Guide” button on the right (at the bottom of the page if you are using your mobile)
How to use the Living Expenses Guide
When you use the guide to help you put together your living expense budget you may feel that some of the figures seem restrictive. Despite this they are known to be generally accepted by Trustees and so if you want budget to be agreed you should try stay within the figures shown for each category.
Having said that as its name suggests the guide MUST be used for guidance purposes only. Every individual’s situation is different and the actual figures acceptable to your Trustee in each category may be higher or lower than those indicated depending on your circumstances.
BMD Tip: If you feel that you need to spend more than the recommended amounts you should always include these figures in your budget. However you must be prepared to justify any additional expenditure and understand that you might be asked to reduce these if they are not acceptable to your Trustee.
Once you have put together your living expenses budget you should speak to one of our experts who can help you decide whether or not it is reasonable and if Bankruptcy is a sensible solution for you.
Debt Solutions Living Expenses Guide
If you have a debt problem you will need to complete a living expenses budget. What types of expenditures are allowed in your budget? Where can you get a guide to your allowable living expenses? To find out more please visit http://beatmydebt.com/self-help-guides-resources/living-expenses-guide
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