The tax credit overpayment should certainly be included in the trust deed, juliefriend. They have a right to get a dividend from the trust deed and cannot just be left out.

However, I think it is probably worth querying this extra 12 months with your trustee. Were the proposals made to your creditors at the start based on a 36 month period? If so then given that it sounds as though you were up front with your trustee from the very start then I think it is difficult to justify penalising you in this way.

It would be interesting to know what dividend was estimated in the proposals to your creditors at the start too. If the trustee is extending your contributions in order that the proposed dividend to your other creditors is unaffected by adding in this extra creditor then an extra 12 months payments would suggest a much higher than average return to creditors (unless the trustee is taking a significant chunk of the extra funds towards their own costs that is)

Hi Kev
Thank you for your feedback. 36 month term was signed in July 2009 to all my creditors. Then a few weeks later this was extended to 48 months with a view to include the tax credit. 2011 received letter from working tax demanding payment working tax had never been contacted. Also they claim in this report just received that they claimed £3000 PPI they never, I claimed PPI payments myself and handed it over to the trust deed value of £4750. Plus it looks like the creditors are claiming now on this report. Because they hadn't added the working tax in I proposed a payment with working tax and asked the trust deed to reduce it back to 36 month they never responded to my calls or letters. They are now demanding more money each month for the 4th year and my HP for my car finishes in September and they are also wanting the payments I made to my car

If the 4-year period was agreed in order to achieve protection then I'm afraid that you are probably stuck with it, juliefriend.

If the tax credits debt came to light after protection then I don't see why an extra year should be needed given the extra funds from PPI etc that have gone into the trust deed.

What are the consequences if your trustee threatens to terminate your trust deed after 36 months when they have extended it to 48 months and you refuse to pay towards another 12 months

Hi juliefriend.

If the extension to four years was agreed to achieve protection the consequences might be:

1 - A legal attempt to secure the payment from you against your will (directly from your employer perhaps).

2 - The termination of your trust deed without being discharged from your debts.

3 - Sequestration (bankruptcy), which could have a number of effects depending upon your circumstances.

Having said that, a trustee cannot arbitrarily extend a trust deed without reason. It therefore all depends in what order events happened around the start of the process as Kevin has mentioned.