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Notes for Guidance - Bankruptcy (Scotland) Act 2016 (as amended)

This guidance describes the general functions of Accountant in Bankruptcy, interim trustees, trustees and commissioners in relation to their responsibilities regarding bankruptcies which started on or after 30 November 2016.

10.8 Financial education for the debtor

A trustee must decide whether a debtor should complete a financial education course.

The trustee must notify the debtor of their decision and clearly state which module(s) of the financial education course they are required to complete. The notification must be made before the end of the six month period from the date of the award of bankruptcy or when the debtor’s whereabouts are unknown, as soon as reasonably practicable once the debtor’s whereabouts have become known.

The available modules are:

  • Budgeting and Financial Planning
  • Saving
  • Borrowing
  • Insurance
  • Understanding Tax
  • Financial Life Stages (Setting up a new home)
  • Financial Life Stages (Having a baby)
  • Financial Life Stages (Redundancy)

Financial education may be appropriate, if within five years of this award, the debtor:

  • was subject to an award of bankruptcy
  • granted a trust deed
  • had entered into a debt management plan
  • had an approved debt payment plan under the Debt Arrangement Scheme was approved
  • a debtor is subject to, or under investigation with a view to an application being made for a BRO
  • the trustee considers the pattern of a debtor’s behaviour, whether before or after the award of bankruptcy, is such that the debtor would benefit from a financial education course
  • a debtor agrees to complete a financial education course

Debtors who have undertaken a financial education course within five years of their bankruptcy award are exempt from participating in any further courses.

The trustee should consider any known health issues relating to the debtor (including mental or physical disabilities) which would render the debtor unable to complete the financial education course. In these circumstances the trustee should report the reasons why financial education was not appropriate in the report for the debtor’s discharge.

The trustee should complete the online form which is available from Money Advice Scotland (MAS) confirming which modules the debtor should complete. 

The trustee should direct the debtor to Head of Events at MAS to undertaken the required modules. The contact email address is: MAS will contact the debtor to confirm they have access to the online course.

It is the debtor’s responsibility to notify the trustee when they have undertaken the modules and they will receive a certificate for each module completed. However, MAS will be able to provide the trustee with confirmation of completion on request.

If the debtor does not have access to a computer or is unable to use a PC, MAS can send a paper copy of the questionnaire by post. The debtor can obtain guidance over the phone or visit their local money advice office for assistance.

The trustee should notify AiB by uploading a letter, or by way of a note, on the BASYS case file of the requirement for the debtor to undertake any required modules and further advise of the outcome.

If the debtor refuses to undertake or does not complete the financial education course as instructed this should be noted as non-cooperation within the report sent to the Accountant to consider whether or not the debtor should obtain their discharge.

If it is the trustee’s recommendation that, despite not completing the course, the debtor should be discharged the trustee must provide an explanation for this recommendation and consider if the debtor’s behaviour is reasonable grounds for a BRO (see section 14.1 and section 16).

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