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Windfall

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(@dandelion)
New Member
Joined: 10 months ago
Posts: 2
Topic starter  

Hello, I have a couple of questions.

I am only a few months into my insolvency, however, I have received word that the MOD are going to offer me a settlement in a war pension case. I first applied for the pension 2.5 years ago but it has taken until now to go through an appeals process etc.

I will begin to receive around £60 per week once the paperwork is settled, but will also receive a lump sum for payments back dated to when I first applied 2.5 years ago. The war pension is given for disabilities received during service, although I have only claimed recently, I have had the disabilities for around 40 years.

My questions are -

Will this be treated as a windfall or compensation?

Will the Trustee take all of the lump sum, as well as the weekly payments?


   
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Kevin Mapstone
(@kevin-mapstone)
Member Admin
Joined: 15 years ago
Posts: 4253
 

Hi Dandelion.  Welcome to the forum.

That's a tricky question actually.  The answer boils down to whether the war pension is classed in the same way as a social security benefit.  If it does then your lump sum should be safe, though the extra £60per week you are receiving may just mean that you will end up paying more each month from any other non-benefit income that you are receiving, as the ongoing contribution you make is based on overall affordability.

However, to be honest I am not sure whether a war pension is classified in this way.  If it isn't then your lump sum would certainly be at risk of needing to be paid across to your Trustee I'm afraid.  

I will try and get an official answer on this point and come back to you.

Scottish Debt Solutions Expert - Ask me for help setting up a Scottish Trust Deed or Debt Arrangement Scheme plan.


   
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Kevin Mapstone
(@kevin-mapstone)
Member Admin
Joined: 15 years ago
Posts: 4253
 

Update  for you - I have had it confirmed by the Accountant in Bankruptcy's office that a War Pension (or War Disablement Pension) is treated in the same manner as social security benefits.  Therefore you cannot be asked to make a contribution to from it into a Bankruptcy or a Protected Trust Deed. 

It is however taken into account when assessing what you can afford to contribute from any non-benefit income you might receive (eg wages/private pension), so could indirectly mean that you end you having to increase your contribution as a result.

Scottish Debt Solutions Expert - Ask me for help setting up a Scottish Trust Deed or Debt Arrangement Scheme plan.


   
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(@dandelion)
New Member
Joined: 10 months ago
Posts: 2
Topic starter  

@kevin-mapstone Thank you for these replies Kevin, I really appreciate your help. I do have an income from full time employment and make contributions to the Trustee based on the income. All of the pension is classed as compensation, however, I understand that the weekly payment might increase my contributions.

The lump some will comprise of the payments I would have received if they had settled when I made the initial claim. It could be enough to pay the total of my expected contributions!

I'll let you know what happens, thanks again.

D


   
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