Income payments orders (IPOs) under section 310 of the Insolvency Act 1986
Produced in partnership with South Square Chambers and BDO

The following Restructuring & Insolvency practice note produced in partnership with South Square Chambers and BDO provides comprehensive and up to date legal information covering:

  • Income payments orders (IPOs) under section 310 of the Insolvency Act 1986
  • Coronavirus (COVID-19)

Income payments orders (IPOs) under section 310 of the Insolvency Act 1986

An income payments order (IPO) made under section 310 of the Insolvency Act 1986 (IA 1986) allows for the court to direct the income (or a proportion of it) of the bankrupt to be paid to any appointed trustee in bankruptcy (trustee).

An IPO shall require the bankrupt or a third party to make a payment to the trustee equivalent to a payment as it claimed in the order. A third party for these purposes is usually the bankrupt’s employer.

The amount to be paid under an IPO is set on a case-by-case basis. The payments will usually continue for three years but cannot continue beyond that period and may be varied on an application to court by the trustee or the bankrupt (whether before or after the bankrupt's discharge from bankruptcy).

An IPO can continue after the bankrupt's discharge from bankruptcy. In Azuonye v Kent, which concerned the effect on an IPO where the debtor is made bankrupt for a second time, the Court of Appeal held—in overturning the decision below—that an IPO will not survive a later bankruptcy. Any sums due under it will be a provable debt in the later bankruptcy (for the benefit of the earlier bankruptcy creditors), but the earlier trustee cannot continue to collect payments from the bankrupt or a

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