Trust Deed Forum - 2nd Wage Arrestment
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thegeerant
Contributor

7 Posts

Posted - 17 October 2019 :  11:10:04  Show Profile  Reply with Quote
Hi all,

Really hoping for some advice. I currently have my Trust Deed payment set up as a wage arrestment so that it's always paid. I've stupidly got myself in Council Tax arrears and now have had a wage arrestment for that added to my wage.

Now instead of £118 being taken , I have £263!! This seems like an awful lot and not sure if my employer have done this correctly? I notice guidelines for my earning state that maximum deduction applies as 19% of earnings over £529.90.

Does anyone know how much should have been taken or how it works when you have more than 1 wage arrestment?

Any help would be appreciated.

Thanks,

Grant

TDA (Debt Adviser)
Trust Deed Expert



13402 Posts

Posted - 17 October 2019 :  12:23:56  Show Profile  Reply with Quote
Welcome to the forum thegeerant.

Can I please check that these council tax arrears arose after your trust deed began?

If you fall within the 19% maximum deduction banding, then a second arrestment should not take the total deduction above that 19% amount. My understanding is that the 19% would be shared between the two arrestments, so the first arrestment (by your trustee) might reduce to a lower amount.

My understanding is also that, where there is a second arrestment, that this might no longer get administered by your employer. Is your employer administering both currently?

How much is your take home pay (weekly or monthly)?

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thegeerant
Contributor

7 Posts

Posted - 17 October 2019 :  12:33:29  Show Profile  Reply with Quote
Hi!

Thanks for getting back to me,

Yes, the arrears arose after my trust deed began.

That was my understanding too but struggling on where to turn to to resolve this.

My take home pay per month was £1130 (this was after my trust deed arrestment of £118) , this month it's £984. So my "court order" has went up month on month from £118 - £263 .

Thanks again,

Grant
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TDA (Debt Adviser)
Trust Deed Expert



13402 Posts

Posted - 17 October 2019 :  15:22:18  Show Profile  Reply with Quote
OK - so your take home pay without wage arrestments would be £1248 if I'm understanding this correctly.

This puts you in the 19% category. The first £529.90 gets excluded, so we're talking about 19% of the difference (which is £718.10).

19% of £718.10 is £136.44.

Your arrestments of £263 per month are clearly much higher than this calculation would suggest they should be.

I think you need to speak with your employer to question whether this is being handled correctly and to request that they check their obligations.

You may also need to speak with your trustee. It sounds like the amount they'll be able to directly collect from your employer will reduce. You'll want to understand what this means with regard to the future of your trust deed.

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thegeerant
Contributor

7 Posts

Posted - 17 October 2019 :  15:41:18  Show Profile  Reply with Quote
Thanks again for getting back to me.

That's the same calculation that I've come to. I've raised this with my employer and they're looking into this. In the meantime I'm left quite a bit short on what is already a really tight budget.

I'll keep you updated on what they say and contact my trustee as suggested.

Thanks,

Grant
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TDA (Debt Adviser)
Trust Deed Expert



13402 Posts

Posted - 17 October 2019 :  15:43:03  Show Profile  Reply with Quote
Good luck with all of this thegeerant.

I hope it all gets sorted out quickly and satisfactorily.

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David Tannock
Trust Deed Expert



2383 Posts

Posted - 18 October 2019 :  11:17:41  Show Profile  Reply with Quote
Hi Grant,

Sorry to hear that you have found yourself financially struggling again.

In relation to the payment to your Trust Deed, this probably isnít set up as a ďwage arrestmentĒ but rather an assignation of salary. The payment to your Trust Deed isnít based on a % of your income like a traditional wage arrestment would be and therefore I donít think it has an impact on the 19% etc.

How much council tax arrears do you have?

How long do you have left on the Trust Deed?

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thegeerant
Contributor

7 Posts

Posted - 18 October 2019 :  15:57:11  Show Profile  Reply with Quote
Hi David,

Thanks for getting back to me.

I'm unsure what the payments has been set up as? It's showing just as "court order" on my wage slip. Does this essentially mean that the wage arrestment is correct and separate form the trust deed payment?

I have around £2100 Council Tax arrears (but some of this will be removed as I'm moving somewhere where I'll be paying Council Tax there).

I currently have 2 years or so left of my Trust Deed.



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TDA (Debt Adviser)
Trust Deed Expert



13402 Posts

Posted - 18 October 2019 :  16:30:04  Show Profile  Reply with Quote
Hi thegeerant.

I thought I'd reply as I'm not sure when David will next get chance to visit the forum.

This is probably another thing you'll need to check directly with your employer. I'd imagine the paperwork they will have received via your trustee should clarify whether this is an assignation of salary or a wage arrestment.

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David Tannock
Trust Deed Expert



2383 Posts

Posted - 18 October 2019 :  17:00:38  Show Profile  Reply with Quote
Hi Grant,

I would double check with your Trustee what they have sent to your employer and put in place for the deduction of the payment. Also Iíd do the same with your employer too as TDA has suggested.

When you say the council tax will be less as you will be moving im not sure what you mean by this. If you have accumulated council tax arrears this will need to be paid on top of any ongoing council tax liability.

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Kevin Mapstone
Trust Deed Expert



3859 Posts

Posted - 20 October 2019 :  20:59:49  Show Profile  Reply with Quote
As David says, deduction from earnings for a Trust Deed would not normally be done by way of a traditional earnings arrestment, so does not impact on the calculation for the council tax arrears.

I would suggest that if you are struggling then you may be best speaking to your Trustee and asking if they will agree to reduce your contributions for a period, to be caught up at a later date, perhaps by extending the Trust Deed term instead.

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thegeerant
Contributor

7 Posts

Posted - 22 October 2019 :  09:41:20  Show Profile  Reply with Quote
Thanks all for getting back to me. I've been advised the trust deed payment is a fixed reduction whereas the council tax arrears is an earnings arrestment.

So they are correct in taking what they've took. It's leaving me in a really really tough place. I have no issue paying both but no with the amount that the arrestment is taking. I'm currently paying more in council tax arrears than my actual trust deed. I really don't know what option I have now. I've spoke to my trustee and they've just sent me a link to the wages arrestment legislation.
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David Tannock
Trust Deed Expert



2383 Posts

Posted - 22 October 2019 :  10:30:18  Show Profile  Reply with Quote
Hi Grant,

I suspected that would be the case with the salary assignation and the wage arrestment being treated separately.

You are in a bit of a tricky situation unfortunately as itís unlikely that the sheriff officer / council will stop the wage arrestment now that it is in place.

It might be an idea to speak with the Trustee to see if there is anything that they can do to reduce the payment to the Trust Deed in the short term to try and assist with the wage arrestment. Ask them if they can reduce the payment to try and help. Any reduction in payment to the Trust Deed would mean that it will run longer.

Another option and itís not one which I normally suggest but under the circumstances do you have anyone that could pay off the council tax arrears for you and then you can reach an agreement with them for the repayment of this when you are back on your feet financially?

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thegeerant
Contributor

7 Posts

Posted - 23 October 2019 :  13:23:03  Show Profile  Reply with Quote
Hi again,

So, I spoke to my trustee and they have advised that although they put through a fixed deduction - it should still be treated as a wage arrestment and subject to the same rules (e.g. 19% of salary over £529.90). They've advised me that my employer have done this incorrectly and to seek legal advice if it continues.

I'm a bit confused but my trustee should be best placed with the correct information?

Many thanks,

Grant
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David Tannock
Trust Deed Expert



2383 Posts

Posted - 23 October 2019 :  18:50:06  Show Profile  Reply with Quote
Hi Grant,

Was it over the phone you spoke with your Trustee about this?

Normally a deduction is treated as a salary assignation and not based on a % of your income but a fixed payment and therefore not a wage arrestment.

Iíd suggest emailing your Trustee about the issue and seeking clarification in writing. You might also want to do the same with your employer to get their view on this and also the sheriff officer too.

What would be your plan if the wage arrestment remains along with the Trust Deed payment?

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thegeerant
Contributor

7 Posts

Posted - 24 October 2019 :  13:08:39  Show Profile  Reply with Quote
Hi,

I emailed them and then they followed it up with a call. I've now went back to my work to advise on what my trustee has said.

I spoke to sheriff officers who said it's not up to them on how it's deducted and placed issue with my employer.

My plan at the moment? I have no idea. I am getting conflicting answers and from my employer and my trustee.7

Thanks,

Grant
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