Notice of defaults: everything you need to know
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Getting an Attachment of Earnings can be worrying and leave you wondering what to do. No doubt about it, the authorities don’t make it easy.
There can be a labyrinth of forms to navigate, with strange names and of confusing sections. Our guide will explain everything to make sure you know what to do and when.
What is an Attachment of Earnings
If you reside in England or Wales and you fall behind with your payments on certain debts, then the creditor that you owe money to can take you to Court. If successful, they can ask the Court for the payments you owe to be paid to them by your employer. This is called an ‘Attachment of Earnings’ (AoE) order and it can only be issued by a Court. The Court instructs your employer to send a certain amount of your wage to them, and they send this onto your creditor. You will be notified about the details of your AoE in a document called the N55 form. There will also be a N56 form for you to complete.
For what debts could you receive an attachment of earnings?
You can receive an attachment of earning for the following types of debt:
- • County Court Judgements (CCJs)
- • Council tax arrears
- • Child maintenance arrears - this amount is set by the Child Maintenance Service not the Court
- • Criminal fines
It’s extremely important that you do not ignore the correspondence in relation to any of these scenarios. Doing so can lead to you being summoned to Court and in some cases can lead to prosecution.
Who does an attachment of earning apply to?
Money can only be taken from your income and sent to the Court if you fall into one of these categories:
- • You are an employee
- • You are taxed on a PAYE basis
- • You receive tax credits or a workplace pension
You will NOT receive an Attachment of Earning if you fall into any of the following:
- • You are self-employed
- • You are in the Armed Forces
- • You are a merchant seaman
What is the N56 form?
The N56 form comes with the letter that notifies you about your Attachment of Earnings. It should be completed and returned to the Court within eight calendar days. The form is the way in which you inform the Court about your current employment and household finances.
How to fill in the N56 form
If you are sent an Attachment of Earning Order and N56, you should seek debt advice immediately before you complete and return the form.
It’s important you complete the N56 form accurately. A large part of the form involves detailing your income and expenditure. The details you provide here will dictate how much your payments will be so make sure they are accurate. Use your bank statements to help you.
How to stop an attachment of earning?
On section 10 of the N56 form, there is a box you can tick to request your Attachment of Earnings is suspended, followed by a space for you to give reasons why. There are many reasons why you might tick this box. For example, your job is at risk or it means you can’t afford your bills. Speak to a debt advisor about how you should complete this section.
You should notify your creditor of your intention to request the AOE is suspended. If you’re receiving debt advice it’s a good idea to mention this, too. Your creditors may offer you an alternative way to repay your debts. If you do manage to come to an alternative arrangement, you should also mention this is section 10 of the form.
How much will you have to pay into an attachment of earning?
The Court will write to you letting you know how much your repayments will be. This will be based on the N56 form you submitted. If you can’t afford the payments, you have 14 days in which to reply. You should reply using form N244. You will also need to attend Court where a judge will decide if they can accept the proposed changes.
What if you lose or leave your job?
If you lose or leave your job the payments will stop. However, this is only until you find a new job. You must let the Court know about your new job within seven days. Failure to do so is a criminal offence.
An Attachment of Earnings order should never come as a surprise - it is the outcome of a legal process and you will have been sent paperwork about it. Its vital not to ignore correspondence from people that you owe money to. If a creditor starts action against you, which could end up with an AofE Order, seek debt advice straight away, either from a provider like us, the Citizens Advice Bureau, or use the Money Advice Service to find other sources of debt advice near you.
by Christine WalshBack to blog home