Bankruptcy Made Easy?
With effect from 6th of April 2016, it is now easier to declare yourself bankrupt.
All bankruptcy applications submitted prior to this date had to be (and will still be, in the case of those yet to be determined), submitted to the court and considered by a judge. This means anyone seeking to declare themselves bankrupt would/will have to attend a court hearing in order to be made bankrupt.
With these new rules, bankruptcy applications are moving online and out of the courts. This should in theory make the process far more straightforward and cheaper with the requirement to attend court being removed. Applications will be submitted electronically to an Adjudicator who will make a decision about your application based on the paperwork submitted.
In addition, the fee to declare yourself bankrupt has actually decreased under these new rules from £705 to £655 divided up as follows:
- £130 in order to consider your application
- £525 as a bankruptcy management fee
Payments of this fee can also be made online and in instalments of as little as £5, although the application will not be referred to the Adjudicator until the fee is paid in full.
Bankruptcy should always be a last resort and it is not appropriate in all cases but it always seemed ironic that the costs involved could be a barrier to bankruptcy. This fee change is a step in the right direction for those who find themselves in the position of having to declare themselves bankrupt, but the effect that these changes in practice will have, remains to be seen. Anyone in financial difficulties should not therefore make any rash decision and should always first speak to an Insolvency Practitioner to examine their options. We work very closely with a number of local trusted Insolvency Practitioners. We have experienced Insolvency specialists in our Commercial Disputes Team who can assist individuals and businesses whose financial circumstances look bleak.
Please get in touch if you need any advice on bankruptcy.
your business matters