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Bankruptcy Help & Advice

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Bankruptcy is a legally binding debt solution that’s often used as a last resort if you can’t repay your debts in a reasonable amount of time.

What is bankruptcy?

Available to those living in England, Wales and Northern Ireland, bankruptcy is a formal insolvency process whereby your debts are written off. In Scotland, it’s known as sequestration.

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Check if you qualify

You can choose to apply for bankruptcy yourself. Or, in some cases, one or more of the companies you’re in debt to can petition to make you bankrupt.

In order for this to happen, you must owe a minimum of £5,000.

Applying for bankruptcy is done through the Insolvency Service in England and Wales and the High Court in Northern Ireland. If you do apply, you’ll need to pay the fee of £680.

You can put all your unsecured debts into a bankruptcy, including mortgages. And you’ll have to surrender your home to the agreement.

Once your application has been approved, the companies you owe money to are no longer allowed to contact you or take further legal action to get the debt repaid.

Being declared bankrupt usually involves selling things you own that are of high value, such as your car or house, for money to repay your debts.

You may also have to make a monthly payment towards your debt if you earn enough.

Bankruptcies typically last for a year, and at the end, any remaining debt you have is written off.

However, it’s put on a public record and can affect your career opportunities – for example, you won’t be able to direct a company.

How do I declare myself bankrupt?

To declare yourself bankrupt, you’ll need to fill in an application online.

You can apply for bankruptcy on the government website. You’ll be asked to give details about what debts you owe, how much income you have and what your outgoings are.

If you’ve been contacted by bailiffs or debt collectors, you’ll also need to include copies of any letters you’ve received from them.

This information will then be sent to an official adjudicator, who will review the application and decide whether or not to declare your bankruptcy.

You’ll usually find out the decision within 28 days. It’s also worth bearing in mind that you’ll need to pay the £680 fee before submitting the application.

Can I apply for bankruptcy?

Bankruptcy should always be a last resort for dealing with your debt as it can have a drastic impact on your life.

If you’re thinking about applying for bankruptcy, you should consider the following:

  • Is your total debt level more than the value of all your possessions?
  • Are you unable to repay your debts in a reasonable time?
  • Do you have little or no spare income that could be used in a monthly payment scheme, such as an IVA?
  • Are your circumstances unlikely to change any time soon?

Can I apply for joint bankruptcy?

Joint bankruptcy is available if you and a business partner have taken out debts together. In these cases, you can make a joint application for bankruptcy, as long as everyone involved agrees to it.

Couples are not able to apply for joint bankruptcy. You must apply individually, even if the debts are jointly owned.

If you have joint debts, where you are both named on the credit agreement, and one of you goes bankrupt, the other person will be responsible for paying the full amount owed on their own.

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Bankruptcy and transgender

The Gender Recognition Act states that it is an offence for someone to disclose a gender change wrongfully to others.

However, for bankruptcy, disclosure is allowed for the following reasons:

  • It’s made by or to an official receiver or insolvency practitioner (IP)
  • It’s needed for the official receiver or IP to carry out their role
  • Disclosure is made by someone who knows you have a gender change certificate and the information is included in the disclosure

Your trustee will decide whether your previous gender will need to be disclosed as part of your information. This information will be disclosed if:

  • It’s required to protect or recover possessions
  • It’ll help companies identify debts owed to them

What are the advantages of bankruptcy?

  • Allows you to make a fresh start, usually within a year.
  • Eliminates the pressure of dealing with the companies you are in debt to, as all communication with them has to go through an official receiver.
  • The companies included can no longer take legal action against you.
  • You’ll be able to keep enough money to live on as well as essential belongings – including a car worth £1,000 or less if it is needed for work.
  • If you’re self-employed, you can keep any items necessary for your trade.
  • You may also be able to keep your home if it has little to no equity in it.

What are the disadvantages of bankruptcy?

  • Your credit rating will be negatively affected for six years after your bankruptcy.
  • It will be put on a public record.
  • Your home is likely to be sold if it has a lot of equity in it.
  • Cars over the value of £1,000 are usually sold, however, if a friend or relative pays the difference then it’s possible to keep it.
  • Some jobs are affected by bankruptcy, for example, you won’t be able to work as a company director or be involved with the management of a limited company while you’re bankrupt. You can also no longer practice as a solicitor, accountant or in other financial services.
  • It comes with a cost – you will need to pay £680 to go bankrupt.
  • Bankruptcy can also affect a person’s application to become a British citizen and their status as a person of independent means.

Bankruptcy process

Get advice

Bankruptcy is an extreme measure, so it’s important to seek advice from an expert before you begin an application.

If you decide that declaring bankruptcy is the right decision, make sure you withdraw enough money to live on for the time being, as if your bankruptcy is approved, your bank account(s) will be frozen.

Make your application

You can apply for bankruptcy online and fill out the application in your own time. You must also pay a fee – in England and Wales, this is £680, and in Northern Ireland, it is £669. It is possible to pay this fee in instalments.

Acceptance and agreement of terms

If your application for bankruptcy is accepted, your bank and/or building society accounts will immediately be frozen, and your case will be assigned an ‘official receiver’.

This receiver is someone who decides, based on your circumstances, whether you need to make monthly payments towards your debts, and which of your assets should be sold.

Once the bankruptcy comes into effect, control of your money and possessions is transferred to the receiver. Details of all bankruptcies are recorded on the public Individual Insolvency Register.

Cooperate with the official receiver

At the start of your bankruptcy, you will need to be interviewed by your official receiver – this can be done in person or over the phone.

The receiver then becomes responsible for distributing profits from your savings, and the sale of any assets, between your creditors.

Because the official receiver acts as a mediator between you and your creditors, at this point, they will no longer be able to contact you. During your bankruptcy, you’ll also need to open a new bank account for wages and living expenses.


If you cooperate with your official receiver, you’ll be discharged from your bankruptcy after 12 months.

At this point, your remaining debts will be written off. We’d recommend that you ask for a letter of discharge in case you need to prove this.

If you’ve been making monthly contributions towards your debts, these may continue for up to two more years after your discharge.

It’s important to understand that bankruptcy negatively impacts your credit score and will remain on your file for six years from the time it began.

Once you have been discharged, you can begin to rebuild your credit score.

What happens at the end of bankruptcy?

Bankruptcies normally end after a year. Your official receiver will let you know when your bankruptcy comes to an end.

Most debts that have been included will be written off, with the exception of a few debts like court fines and student loans.

It’s important to note that after a bankruptcy, you could still have a bankruptcy restriction order made against you – this can restrict your financial affairs for up to 15 years.

This order can be made for a number of reasons, including lack of co-operation with the official receiver or if you take on debts knowing you won’t be able to pay them back.

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Frequently asked questions.

Need more info? Here are a few of our most frequently asked questions on this topic. If you don’t see the answer you’re looking for here, give us a ring – we’d love to help.


It’s very unlikely that being declared bankrupt will affect your current employment, but there are some exceptions to this if you work in certain professions, for example, the financial industry.

If you run your own business, you’ll have to surrender this to the trustee, so you won’t be able to continue trading with that business. You can begin a new business, but it’ll be especially challenging to get any credit to help you.

Even though you are normally discharged after 12 months, bankruptcy will be noted on your credit file for six years. After this, your details will be removed.

Although it is possible to buy a house after you’ve been made bankrupt, though it will be more difficult. Generally, it’s best to wait around two years before applying for a mortgage after bankruptcy, as you’re more likely to get better terms and interest rates – it also gives you time to rebuild your credit score.

Yes – when you submit your application online, an adjudicator will decide whether or not to grant your bankruptcy. As such it is possible for it to be denied.

This is often done if they feel you are able to pay back your debts or if there is another route you could go down that would be a better fit for your situation.

Yes, if you fall into debt and you break your credit agreement, the company can petition for you to be made bankrupt. You will normally be notified of this by post, so if a company writes to you regarding this, it’s important to contact them straight away.