Mandatory Surplus Income Payments

October 10th, 2006 by Questions

I make about $2800 a month after deductions. Not married and has no kids.
I know if I go bankrupt I have to make Surplus Income payment.
Are these payments for 9 months or longer (untill I get discharged)?

Thanks.

Dan

Questions

3 Responses to “Mandatory Surplus Income Payments”



, Barton Goth, GCO Inc. Bankruptcy Trustees said:

Although there may be some regional variation to this, I would suggest you could expect to remain in bankruptcy for a total of 21 months and have to make surplus payments for each of these 21 months. Ultimately your trustee is required to disclose to the court that you make a fairly significant level of surplus income, and while the court has discretion so nothing is guaranteed (it could be less than 9 months or it could be more), but typically the courts I deal with normally an additional 12 months (guaranteed 9 months plus an additional 12 gives us the 21 mentioned above).

However, I practice in Alberta, therefore if I suggest you contact a licensed trustee in your area so they can give you a indication of what takes place locally.

Alternatively, there is a good argument to consider a consumer proposal as it may allow you to avoid a bankruptcy, provide greater certainty as to payments and duration of your file.



, Anonymous said:

Hi Barton,

Thanks for your advice.

Would it be same for unemployed person?
Since, some of them have lower income they wont be able to make any Mandatory payments.

Thanks.
Dan



, A licensed trustee said:

The answer depends on the person’s income. If the person is unemployed and has no income, then they would not have any surplus income, and therefore would not be required to make any surplus income payments. In that case, it is likely that the person’s bankruptcy would end in the minimum nine month period.

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