If you are going through the process of declaring yourself Bankrupt we consider the budget you can include for children who are living at home.

If you have children of school age who are living with you at home when you are completing your bankruptcy application you must include a reasonable amount in your monthly expenditure budget to cover their living expenses. This includes a specific budget for housekeeping, clothing, meals at school and a certain budget for school trips.

Clearly if you are required to pay maintenance for children not living with you this should also be included in your budget. But what about a budget for children who are no longer at school but are still living with you?

Can you include expenses for children above school age still living at home?

If you have children or other people living with you who are above school age, then whether or not you will be able to include a budget for them in your living expenses allowances will depend on the specific circumstances.

If the child is working and giving you money towards the housekeeping, you will need to include this form of income on your application form. It will then be reasonable to include a budget for them in your housekeeping expenditure.

In these circumstances, extra money for clothing would probably not be allowed as they would be expected to pay for these things themselves.

BMD Tip: If while you are bankrupt or paying an income payment order a child you are supporting leaves home you will need to tell the Official Receiver. Overall the effect on your income and expenditure budget should be relatively minimal as your expenses would fall but at the same time so would your income assuming that any money you received from this child would stop.

Do you want help to go Bankrupt? Give us a call on 0800 077 6180 or complete the form below to speak to one of our experts

What if I have children living with me who are not working?

If children of above school age are living with you but are not working, they may well still be depending on you. As such you may well feel that it is necessary to include money in your housekeeping budget to support them.

However the Official Receiver will look at the situation closely. It is possible that they may argue that it is not reasonable for you to continue to support your children unless they can be seen to be making an effort to contribute to the household income.

If you have children in higher education who you are supporting, then you should include an appropriate budget for this.

Again you will need to be prepared to justify the expenditure you include. The OR will consider this in the context of your overall financial situation and may require evidence of any other income that these children receive.

Your bankruptcy living expenses must be justifiable

If you are going through the bankruptcy process you will need to submit an income and expenditure budget so that the official receiver can decide whether you can afford to contribute towards your creditors. Your expenditure budget should reflect the fact that you have dependent children living with you or you pay maintenance for children living elsewhere.

If you have children living with you who are above school age as long as they are contributing to the household income, including a housekeeping budget for them should not be an issue. However, if they are not contributing financially you may not be able to include a budget unless you can show they are unable to work.

BMD Tip: You must make sure you are comfortable that the amount you include to cover the cost of your children is enough to cover what you spend each month. However, this must also be reasonable.