There are a number of duties you must complete while you are bankrupt.
Duties at start of bankruptcy
As soon as your bankruptcy begins, you must surrender your credit cards and all non-exempt assets to your trustee:
Creditors meeting
In most personal bankruptcies, no creditors’ meeting is held. A meeting of creditors is held if requested by the Superintendent of Bankruptcy or by creditors with an aggregate of at least 25% of the proven claims. These meetings are usually held at the office of the trustee.
Income tax
You must give the trustee your T-4 slips and any other information necessary to complete any outstanding tax returns to the date of bankruptcy. When you file for bankruptcy, the day you file is treated like the end of your tax year so that in the year you file bankruptcy you actually have to file two different tax returns. All income tax debt will be included in your bankruptcy, although you may be required to pay it separately. Any refund to which you are entitled will be an asset that will come to your trustee for your creditors.
Monthly reporting
Each month, you must report your household income and living expenses and any change in your family situation to your trustee, along with copies of your pay stubs. Your trustee will give you appropriate forms to fill in order to provide him or her with this information.
From your income and expenses, your trustee determines if your net income was higher than the limit allowed by law for you to live. If you have any “surplus income”, you will be required to make a payment each month to the trustee. In a bankruptcy 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 income reporting that requires the most homework. However, the monthly income and expense reporting throughout bankruptcy is usually very helpful for most people, as they now keep track of the money coming into the household and how they spend it and when.
Counseling Sessions
To be eligible for an automatic discharge after 9 months, you must participate in 2 credit counseling sessions. The counseling can be one-on-one, with yourself and your trustee, or if you prefer, it can be in a group consisting of other bankrupts and your trustee.
