1. ATTACHMENT OF EARNINGS (AOE)
INFORMATION FOR ADVISERS

2. ATTACHMENT OF EARNINGS (aoe)
MEANING
DEFINITION
EXPLANATION

3. What is an aoe?
This is an order from the court which allows money to be deducted from wages/benefits and paid to Court to meet a debt
If a Creditor has a County Court Judgement for the debt which isn’t being paid, they can enforce the judgment by asking the Court to grant an AOE
Prevents a creditor from enforcing a debt by a Warrant of Control, a Charging Order or a Third-Party Debt Order without first obtaining permission from the Court
A County Court AOE does not take priority over an AOE for fines, maintenance or local taxes even if made earlier but does take priority over a direct earnings attachment made by DWP to recover benefit or tax credit overpayments and social fund loans if the county court AOE was made before

4. What is an aoe?
The court can order deductions to be made directly from earnings if:
The client is behind on payments to the CCJ
The client is an employee, not self-employed
The client owes more than £50 on the judgment
An AOE CANNOT be made against the pay or allowances of a member of the Armed Forces but the Defence Council can make compulsory deductions from the client’s pay even if they are stationed outside the UK
Notification is made on form N55 with a form N56 attached
Time limit to complete and return N56 is 8 days
It is an offence if the client fails to respond to the N56. Enforcement Agents will serve an order on the client to fill the form in and if they don’t do this, the client can be summonsed to court and could face imprisonment for up to 14 days if they fail to attend

5. n56 The client needs to complete the N56 showing
Name, address and number of dependants
Employers details
Income and Expenditure
Details of any other debts and court orders they have and how much they are paying to each
Make an affordable offer of payment
The client can also ask for the AOE to be suspended if there is a chance it could result in loss of employment or promotion once the employer becomes aware

6. Protected payments
The court cannot make an AOE order if take home pay is below a certain level – called the “Protected Rate”
The Protected Rate is calculated by the court staff and uses pre-determined figures for essential expenditure such as housekeeping
Suspended AOE are at the discretion of the court
Typically a deduction from earnings is set between 50% and 66% of the client’s “disposable income” (net earnings minus protected earnings)

7. Appealing against an aoe
The client & creditor have 14 days from the date of the AOE Order to object to it’s terms
They must write to the court with details of the objection
A hearing will be held at the client’s local court
The judge will decide

8. employer
Some employers may have a policy of dismissing anyone who has a County Court Judgement (CCJ) made against them
The employer will be told the full amount due under the CCJ and the rate to be deducted
Employers can add a fee of £1 to every deduction they make to cover their admin costs

9. Can a creditor contact an employer?
The Creditor is not allowed to go direct to an employer though they can provide the employer details to the court
The court will contact the employer for details of the client’s earnings if they don’t return the N56

10. AOE for council tax
Can be an option once a Liability Order has been issued
Fixed percentage deductions dependant on net weekly/monthly pay e.g.
£200 net weekly pay would be 7% deduction rate
£1500 net monthly pay would be 17% deduction rate

11. Direct earning attachment
If you’ve had benefits overpaid by the Department of Work & Pensions (DWP) or your local authority they may be able to take money from your wages. This is called a Direct Earnings Attachment (DEA) and they don’t need to take you to court to do this.
A DEA can be used to collect:
Any overpayment of DWP benefits
Overpaid housing benefit from your local authority
Loans from the DWP Social Fund that haven’t been paid back
The amount taken from your wages will be a set percentage of your income, and the higher your wage, the larger the percentage taken. The DWP or local authority has the power to reduce the amount taken if it’s causing you hardship.
The DWP or local authority will write to you before starting the DEA, and you may be able to avoid the DEA by agreeing to pay the debt in instalments instead.

12. Deduction from benefits
After a Liability Order is granted by the Magistrates Court, the council can instruct the Department of Work and Pensions (DWP) to make deductions from the following benefits providing the person named on the bill is in receipt of one of them:
Jobseeker’s Allowance (JSA)
Income Support (IS)
Employment Support Allowance (ESA)
Pension Credit Guaranteed Credit (PCGC)
Universal Credit
For a court fine the same benefits can have deductions made against them but the rate is £5 per week when the benefit is income based, except for Universal Credit when it can be up to £25 per week
If the client is in receipt of contribution based JSA or Contributory ESA, the deduction can be up to 40% of the benefit

13. Consolidated orders
If client has an Attachment Of Earnings (AOE) and other County Court Judgements (CCJ’s) they can apply to have a Consolidated AOE Order
Means one monthly payment deducted by the employer and sent to the Court to cover all CCJ’s
Application is made on form N244
No fee is paid upfront to apply for this, but 10p is deducted by the Court for every £1 paid in whilst the Consolidated AOE is in force

14. Changing the payments
Payments can be varied by applying on form N244 when circumstances have changed and the client can no longer afford the deductions
Fee is applicable
An Income and Expenditure will need to be completed explaining why the deductions are no longer affordable

15. How long does it last?
It lasts until all the included debts have been repaid
If the Judge grants a Composition Order the repayments will only need to be made for 3 years
The Admin Order is recorded on the credit file for 6 years from the date the Order was made
Also added to the Register of Judgments, Orders & Fines for 6 years from the date the Order was made