At Bankruptcy Guide, we'll help you break down the essential steps involved in declaring bankruptcy, providing clarity and guidance to those navigating this complex terrain. From initial considerations to final discharge, understanding how to declare bankruptcy UK is crucial for anyone seeking to regain control of their finances and embark on a journey toward financial stability.
*The information on this page relates only to declaring bankruptcy in England or Wales. The procedures are different if you live in Northern Ireland or Scotland.
Step One: Make Sure Bankruptcy Is The Right Choice For You
The first and arguably most critical step when considering whether to declare bankruptcy UK is to thoroughly assess whether it is the right choice for your circumstances. This decision should not be taken lightly, as bankruptcy carries significant implications for your financial future. Begin by evaluating the extent of your debts, your ability to repay them, and any alternative options available to manage your financial difficulties.
At Bankruptcy Guide, we can provide dedicated and tailored advice, helping you weigh the pros and cons of bankruptcy and explore alternative debt management solutions. Taking the time to carefully consider your options and seek professional guidance ensures that you make an informed decision that aligns with your long-term financial goals and objectives.
Step Two: Application Form
The next step when considering to declare bankruptcy UK, is the application form. To access the form, you must first register on the Government's online system, providing your name, date of birth, and email address. Once registered, you can log into your account and begin filling out the form, which consists of eight sections.
These sections cover various personal details, with a focus on key areas such as employment history, assets (including property, vehicles, and insurance policies), debts, and income and expenses budgets.
It's worth noting that you can save your progress and return to the form later if needed. However, it's important to mention that the Government's system does not provide information or advice on completing the application.
At Bankruptcy Guide, we can walk you through the process, providing support and guidance on how to complete your application form correctly and properly.
Step Three: The Fee
Before submitting your completed application form to declare bankruptcy UK, you have to pay the required fee. This can be done via the payment system within your application. Payment options include debit or credit cards. While it's possible to pay the fee in instalments as small as £5, your application cannot be submitted until the fee is paid in full.
Once the fee is settled, you have the discretion to choose the date and time for submission. Upon submission, your application undergoes review by the Adjudicator. Approval is typically automatic provided you meet certain eligibility criteria, such as residing in England or Wales for at least the past six months.
Notification of your bankruptcy status is sent via email, after which you can access your account to download your Bankruptcy Order—a crucial document confirming your bankruptcy status and reference number. While the Adjudicator has up to 28 days to decide, in most cases, bankruptcy is granted within 2 working days.
For more information about the cost of Bankruptcy, click here.
Step Four – Official Receiver Interview
Now you have completed the declare bankruptcy UK process, you can expect to be contacted by the Official Receiver. They will normally want to conduct an interview with you. This will allow them to understand the reasons why you have gone bankrupt and how to deal with any assets you own such as your car or property.
The interview is normally carried out over the phone or on-line using MS Teams and lasts for between 30 minutes and an hour. Where your circumstances are more complex, the OR may want to conduct your interview face to face in one of their regional offices.
Step Five: Income and Expenses Review
The Official Receiver will use the information provided in your application form to assess your ability to make monthly payments towards your debts. If they determine that you have any surplus income, they will issue you with an Income Payment Agreement (IPA). This requires you to pay your surplus income towards your debts for three years.
A member of the Official Receiver's Income Payment Agreement (IPA) team may contact you via telephone to clarify the details of your income and expenses budget. During this conversation, they might ask for confirmation on how you calculated your income, especially if you're self-employed.
It's important to note that the Official Receiver can request an update of your income and expenses budget at any point during your bankruptcy period.
Step Six: Discharge after 12 months
After you declare bankruptcy UK, in almost all cases you will be bankrupt for just 12 months. Upon the completion of one year, your bankruptcy will conclude, a process known as becoming discharged. This discharge occurs automatically, without the issuance of a confirmation letter from the official receiver.
In rare instances, your bankruptcy might last longer than 1 year. This can happen where the Official Receiver believes that you are not co-operating with their investigation of your circumstances. In these cases they will apply to the Court for your discharge date to be suspended. This suspension will last until they are able to satisfactorily conclude their investigations.
Suspended discharges often happen where an individual is made bankrupt by one of their creditors but they are not aware that this has happened. Perhaps because they are no longer living in the address that they originally registered with the creditor
Considering whether to declare bankruptcy UK? Contact Bankruptcy Guide
If you're weighing the decision of whether to declare bankruptcy UK, seeking advice from Bankruptcy Guide can provide invaluable clarity and support. Our team of experts is dedicated to helping individuals navigate the complexities of bankruptcy, offering tailored guidance to suit your unique circumstances.
Whether you're unsure about the implications of bankruptcy, exploring alternative debt management solutions, or ready to initiate the process, our advisors are here to assist you every step of the way. Don't hesitate to reach out to Bankruptcy Guide for expert advice and assistance as you consider your options for financial recovery.