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Earnings arrestment is a form of diligence – or enforcement action - frequently taken by creditors in Scotland to recover unpaid debts. If you owe money to a company or have unpaid Council Tax arrears, you may be at risk of having your wages arrested in order to force you to pay back the money you owe.
A wage arrestment is a form of enforcement action which involves taking money directly from the wages of a debtor who has failed to adequately deal with their debt. This is done through an Earnings Arrestment Order (EAO) which is given to your employer and instructs them to deduct a given percentage of your wages and pay this money to the sheriff clerk who will then administer this payment to your creditor(s).
Here are the key facts you should know about wage arrestment in Scotland:
o Between £566.51 and £2,047.65 – An amount of £15.00 or 19% of earnings above £566.51, whichever is higher.
o Between £2,047.65 and £3,078.47 – An amount of £263.23 plus 23% of earnings above £2, 047.65
o Above £3,078.47 – An amount of £518.15 plus 50% of earnings above £3,078.47
These figures are based on monthly net income amounts; there are alternative calculations if you are paid on a weekly or daily basis. In addition to these figures, employers can also subtract an additional £1.00 every time a deduction from your salary is made in order to cover the administrative costs incurred on their behalf.
The amount that will be taken from your wage depends on how much you earn and how often you get paid. There is an amount you are allowed to earn before any wage arrestment deduction is calculated. The current net (after tax) figures are:
Once your earnings pass the above figures, a calculation will be done and a percentage of your income above this amount will be taken directly from your earnings and sent to the creditor. Please see below for the current wage arrestment calculators.
Wage arrestment calculator for those paid weekly:
|Net earnings (weekly)
|Wage arrestment deduction
|Between £130.73 and £472.54
|£4.00 or 19% of earnings above £130.73 (whichever is greater)
|Between £472.54 and £710.42
|£64.94 plus 23% of earnings above £472.54
|£119.66 plus 50% of earnings above £710.42
Wage arrestment calculator for those paid monthly:
|Net earnings (monthly)
|Wage arrestment deduction
|Between £566.51 and £2,047.65
|£15.00 or 19% of earnings above £566.51(whichever is greater)
|Between £2,047.65 and £3,078.47
|£281.42 plus 23% of earnings above £2,047.65
|£518.51 plus 50% of earnings above £3,078.47
Council tax arrears are one of the main reasons behind a wage arrestment order in Scotland. If you fail to pay the council tax you owe and fall into debt, your local council are unlikely to let the situation continue for long before taking action against you to recover the money you owe.
If you have fallen behind in paying your council tax, or if you are concerned that you may soon receive a wage arrestment for council tax debt, you should make it a priority to tackle the situation head on. If you are unable to clear your council tax debts or arrears, you should get in contact with a wage arrestment expert who can talk you through your options. At Scotland Debt Solutions, our advisors are here to provide help and advice when it comes to paying council tax debt.
It is possible to have more than one wage arrestment at the same time. When this happens, this is known as a conjoined arrestment. The good news is that this will not affect the amount you have to pay via your earnings, instead the amount deducted from your wages will be split amongst those creditors that have a wage arrestment order against you. As far as the money that can be taken from your wages, the figures shown above still apply even with multiple wage arrestment orders.
As with most debt issues, it is highly advisable to take action at the earliest possible opportunity as this means there will be many more options open to you. Before your wages are arrested, you will not only be given warning of this, but also the opportunity to come to an alternative arrangement such as agreeing to a Time to Pay (TTP) plan. If this is not suitable in your circumstances then a more formal debt solution such as a Trust Deed or Debt Arrangement Scheme (DAS) may be more appropriate. Formal debt solutions can only be entered into under the guidance of a licensed professional, so taking expert advice at this time is crucial.
Scotland Debt Solution’s team of debt specialists have helped countless individuals across Scotland get a form hold of their personal finances and work their way out of debt. We can advise across a range of formal debt solutions including sequestration, DAS, and Trust Deeds. Call our expert team today on 0800 063 9250 to arrange a completely free no-obligation consultation and take your first step towards a debt-free future.
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