How to declare yourself bankrupt
What is bankruptcy?
Bankruptcy is a legal proceeding involving a person or business that is unable to repay their outstanding debts. The bankruptcy process begins with a petition filed by the debtor, which is most common, or on behalf of creditors, which is less common. All of the debtor’s assets are measured and evaluated, and the assets may be used to repay a portion of the outstanding debt.
Applying for Bankruptcy
In case you declare yourself bankrupt, you can apply online via the UK’s government website, and pay a fee of £680. After you apply, an Adjudicator (a person working for the Insolvency Service) will analyse your case and decide whether you should be made bankrupt or not.
If you’re allowed to enter into bankruptcy, then:
- You’ll get a copy of the bankruptcy order (you may also be called in for an interview about your situation);
- The assets you own can be used to pay off the debts;
- You’ll be asked to follow the bankruptcy restrictions (borrowing more than £500 without saying that you are bankrupt; acting as a director, creating, managing or promoting a company without the court’s permission; working as an Insolvency Practitioner). Remember that breaking these restrictions is a criminal offence.
- Your name and details will be published in the Individual Insolvency Register (IIR) – if publishing your details will put you in peril, you can apply to get these removed.
- Your creditors can also make you bankrupt if:
- You owe over £5,000, and you haven’t paid off your debts;
- You broke the Individual Voluntary Arrangement (IVA) terms;
- You gave false information to receive an IVA
How to Apply
To apply for bankruptcy, these are the forms you need:
- The petition for bankruptcy (includes the reasons for your request);
- The statement of affairs;
- A sworn statement (made before an officer of the court/solicitor)
What Happens when the bankruptcy ends?
The bankruptcy period normally lasts for 12 months, after which the individual will form any restrictions and debts, and all details will be removed from the individual insolvency register (IIR). The discharge is automatic
If the individual who has applied for bankruptcy doesn’t cooperate with the trustee, the process can last longer than 12 months.
How can we help you
If you are planning to declare yourself bankrupt or if creditors are trying to make you bankrupt, don’t hesitate to contact us as well provide you with the best business advice on the market. Call us now for free on 02035988621.