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Bankruptcy

Bankruptcy is a serious matter but even if you are deeply in debt it doesn’t mean you have to declare yourself bankrupt. Bankruptcy is a way of freeing you from debts you cannot pay so that you can make a fresh start with some restrictions. It will almost certainly involve the closure of any business you are involved in, dismissal of any employees and the loss of possessions of value and possibly your house if you have one. As other restrictions will be imposed you should look at the alternatives as soon as possible.

You can be made bankrupt in two ways

• By debtors’ petition. If you want to make yourself bankrupt, you must contact your local court where they will give you the details of the nearest county court dealing with bankruptcy. You will then pay a deposit of £250 plus a fee of £20.
• By creditors’ petition. Creditors owed at least £750 by you can raise a bankruptcy petition against you. They then present the bankruptcy petition at the High Court in London or at the County Court near where you live.

Who will deal with my case?

• Either the Official Receiver or an Insolvency Practitioner dealing with your case will act as a trustee of your estates. The Official Receiver is a civil servant of the court who will administer your bankruptcy. His duties include investigating your financial affairs for the period before and during your bankruptcy, and he reports back to your creditors.
• An Insolvency Practitioner must be licensed and is usually an accountant or solicitor and is responsible for disposing of your assets and paying off your creditors.

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