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

In accordance with section 131 of the Act – Distribution in respect of accounting periods, the trustee is required to pay a dividend out of the estate in respect of each accounting period, if funds are sufficient, after making allowance for future contingencies.

If, however, the trustee is not ready to pay a dividend or considers it would not be cost effective to do so, the trustee may, with the consent of the commissioners or AiB, postpone the payment of a dividend until the next account period.

AiB considers that where there are sufficient funds to pay an interim dividend (after making allowance for future contingencies), in respect of each accounting period, a scheme of division should be submitted for approval. A dividend of 5p in £ is considered a reasonable measure of sufficiency for assessing interim distribution requirements.

In cases with funds, if the trustee is not ready to pay a dividend or considers it is not cost effective to do so, a note should be added to the account requesting to postpone the payment of a dividend and providing an explanation in support of this request. To assist AiB in assessing the request for postponement, the trustee should ensure an up to date statement of affairs is uploaded to BASYS or update the case debt section of BASYS, to inform the AiB of the known creditor position. The accounts team will raise an audit observation consenting to the request or will ask the trustee to accelerate the next account and pay a dividend

On some occasions, where the funds in the case appear sufficient to pay a dividend, the trustee will be asked to provide an estimated outcome statement or a copy of the calculation used to determine funds are insufficient to pay an interim dividend of 5p in the £.