Alternatives To Sequestration - LILA (Low Income Low Asset)

Bankruptcy has always been a last resort for debt problems in Scotland and there may be other options available to you.



Low Income Low Asset (LILA)

A Low Income Low Asset (LILA) is a route into bankruptcy which allows a debtor in Scotland with an income equivalent to or less than the national minimum wage, and has no single asset valued at £1,000 or more, to apply for their own bankruptcy.

Income includes money from all sources including any maintenance payments that you receive.

If you receive income support, income-based jobseekers' allowance or working tax credits you will be treated as meeting the low income test, even if your actual income is more than the national minimum wage.

When calculating your income, no account will be taken of other social security benefits or tax credits you receive or any income paid to another member of your family.

However, your income, pensions, maintenance payments, benefits, tax credits and the income of other family members may be taken into account when considering whether you should pay a contribution while you are bankrupt.

Low assets means that you have no single asset worth more than £1,000 and your total assets are not worth more than £10,000. In addition, it means that you must not own or jointly own a house or any other property or land.