What Is an Attachment of Earnings Order?

If you don’t pay the amount outlined in a County Court Judgement (CCJ), your creditor can apply to have an attachment of earnings order (AEO) taken out against you.

An AEO is a court order which allows payments towards your debt to be taken directly from your wage slip, effectively removing your choice to pay.

In this guide, we’ll be explaining when an AEO can be applied against you, how the process works, and what you can do if you think you can’t pay.

When Can an Attachment of Earnings Order Be Made?

If you’ve not been keeping up with a CCJ, your creditor may ask the court to issue an attachment of earnings order. The court can issue an AEO against you so long as you:

Owe at least £50
Are behind on CCJ payments
Are an employee

You cannot be subject to an AEO if you’re self-employed, or if you rely on benefits.

Responding to an Attachment of Earnings Order

When the court issues an attachment of earnings order against you, you’ll receive an N56 form. This form – also known as a ‘statement of means’ – is used by the court to determine what will be taken from your monthly income. You’ll need to include:

Your name
Your address
Your dependants
Your employer details
Your income and expenditure
Any additional court orders or debts you might be subject to

The form will ask you to make a repayment offer so that your monthly contributions are affordable. The offer should be reasonable, justified by your monthly budget.

The court will factor in your household income, expenditure and essential costs to come up with a ‘protected earnings rate’. Amounts will only be taken from your earnings when they go beyond this rate, protecting the welfare of your household.

What Happens if I Don’t Send the Form Back?

When you receive an N56 form, you’re given 8 days to return it to the court. It’s important that you do this.

Failure to respond (or providing false information on the form) is a criminal offence.

When you fail to respond, the court is likely to send County Court bailiffs to serve you with an order to complete the form. If you continue to ignore the form, you’ll be scheduled a court hearing to explain your non-compliance. Failure to attend will result in an arrest warrant being issued.

When arrested you may be brought to court, or sent to prison for up to 14 days. You may also receive large fines.

Can I Dispute the Order?

You may not be happy with an attachment of earnings order for a number of reasons. You might think the monthly repayments are too high, or you may be worried that the order will have an effect on your employment.

If you’ve got a problem with the terms of the order, you have 14 days to inform the court. Once you complain, a private hearing will be scheduled with the District Judge, where they will listen to you explain your personal budget and the reasons you think the order should be changed or suspended.

If it’s been more than 14 days, or your circumstances have changed, you can apply to the court to have the order varied via an N244 form. This will incur some court fees.

What Is a Consolidation Order?

If you have multiple court orders or CCJs, it can be very worrying, with the repayment of multiple debts feeling overwhelming and hard to keep track of.

In cases like these, you may want to think about getting a consolidation order. This consolidates the repayments of all your debts, allowing you to make one payment rather than several. The court receives the money and divides it up between your creditors on your behalf.

You’ll have to pay 10p on the pound for every transaction handled by the court.

Note: Only debts under the consideration of the courts can be entered into a consolidation order; external debts cannot be included – to do this, you would need an IVA

Speak to an Expert Today

If you’re struggling with personal debt problems, you should seek professional guidance as soon as possible.

Early action can help to prevent interest and charges from spiralling things out of control. Our team can help you decide your best option, whether it be an informal preventative measure such as a Debt Management Plan, or a formal insolvency procedure such as an Individual Voluntary Arrangement.

Get in touch to book a free consultation today.

FAQs

Does Leaving My Job End the Order?

If you leave your job, the attachment of earnings stops as there is no wage to take payments from. However, the order is not dead; if you get a new job, your creditor can get the court to deduct payments from your new employer. The order can only be resolved through repayment of the debt.

How Do I Alter the Terms of My AEO?

You can apply via an N244 form to vary the order if your circumstances have changed and you can no longer repay the order. You will need to explain the changes in your budget and why you can’t keep up with the current payments.