There are a number of duties that you must complete while in bankruptcy. As soon as you start your bankruptcy, you must surrender all your credit cards.
Meeting of Creditors
You must attend the meeting of creditors, if one is carried out. At this meeting, creditors will have the opportunity to ask questions about your bankruptcy. However, most personal bankruptcies a creditors meeting is not held.
You must give the administrator your T-4 slips and any other information needed to complete tax returns at the date of bankruptcy.
When you file for bankruptcy, that day is regarded as the end of your tax year, so that in the year of bankruptcy you really have to file two different tax returns.
Any income tax debt will be included in your bankruptcy, but you may have to pay it separately. Any refund you are entitled to will go to an asset manager and then go to your creditors.
Each month, you must report your income, expenses and any change in family situation together with copies of pay stubs. Your administrator will provide you with the appropriate forms to fill in order to provide him or her with this information.
From your income and expenses, the administrator determines whether your net income was higher than the limit allowed by law for you to live. If you have any “excess income,” you will be required to make a payment each month to your administrator. The more you earn, the more you are required to contribute to your estate for the benefit of your creditors.
For most people it is the monthly reporting in that require the most work. However, the monthly income and expense reporting over this time period is very useful for most people, because now they can keep track of money coming into the home and how they spend and when.
To be eligible for an “automatic nine month discharge” you must attend two credit counseling sessions. Counselling can be one-on-one with you and your counselor, or if you prefer, you can be in a group of other bankrupts and their administrator.
The first counseling session should be between 10 and 60 days following the start of the bankruptcy, the second counseling session should be held no later than 210 days after the date of bankruptcy.
This credit counseling is designed to teach you budgeting and good money management, so you are less likely to have financial problems in the future. Each session is approximately one hour and your budget and the causes of your financial difficulties is discussed.
Experience shows that credit counseling reinforces your income and expense reports, which gives you better control of your finances.
- You must inform the administrator as to where you live.
- You must respond to requests from the administrator, help him or her when necessary and provide all information requested.
- If you borrow more than $500, you must tell the lender you are bankrupt.
- You may not be a director of a company.
It is essential to perform these tasks in a timely manner, so that bankruptcy may be completed as soon as possible. For example, if you miss a payment, your discharge date will be postponed. The sooner you get your discharge, the sooner you will be able to rebuild your credit.
If you’re ready to put these financial problems behind you, please contact us and we will guide you in this process.