Seasonal income and bankruptcy
Me and my wife are salespeople who don’t get a monthly salary but are paid based on the sales made. The business is seasonal , We make an average of 10,000 dollars a month between May and October but in the winter months (December – February) we make almost nothing. The money that we save during the summer months is what feeds our family in the winter months.
We are deep in debt and need to declare bankruptcy but what worries me is that the process will not allow us to save enough money during the summer season and we will run out of money by February. We will not be having money for essentials in March , April and early May.
We are not covered by Employment insurance like other seasonal workers (we tried claiming last year but HRSDC gave a ruling which said “NO”) , so we don’t recieve any help from the government.
How does a trustee handle a situation like ours?
Every trustee is required to follow a guideline that is sent around by the Superintendent of Bankruptcy. This guideline is used to determine what the monthly cost of a bankruptcy is.
In terms of your obligation, in a bankruptcy you will be required to pay “surplus” to the trustee when you income exceeds this guideline and the result will be a fluctuating payment each month.
What the trustee will do at the end of a bankruptcy is average your income together for the entire duration so that if you have any really good months they can be offset by the months where no or little money has been made.
In terms of being able to put money away, aa long as you are keeping up with the amount required to be paid you can save as much as you want for those months that are slower.
For more informaiton on this guideline it is best that you contact a local trustee and will be able to give you a better idea of what will take place in your situation.