Bankruptcy

Introduction to bankruptcy

Bankruptcy can feel like a daunting topic for many people. It is a formal legal procedure designed to help individuals, sole traders, and partnerships who are unable to pay their debts. In the UK, bankruptcy is governed by specific rules and regulations, offering a fresh start for those who find themselves in unmanageable financial circumstances. Yet, it also involves restrictions and obligations that must be fully understood before deciding to pursue this route.

Bankruptcy has existed in some form for centuries, evolving into a structured process overseen by the courts and managed by an appointed official receiver. It is intended to protect individuals from ongoing creditor pressure while treating creditors fairly and proportionately. For people facing mounting debts, it can be a powerful solution; however, it comes with consequences that should be carefully weighed.

Below, this guide will walk you through everything you need to know about bankruptcy, from the fundamental concepts and eligibility criteria to the application process itself. Because managing unmanageable debt can be stressful, it is important to approach the subject with accurate information. With the right guidance, you will be better positioned to make sound decisions for your financial future.

Key points covered in this section:

• Definition of bankruptcy: A legal status that provides relief from unmanageable debts.

• Purpose of bankruptcy: To offer debt relief while ensuring creditors are repaid where possible.

• Historical context: Bankruptcy is a centuries-old mechanism, now modernised under UK law.

• Importance of professional advice: Guidance from experts can ensure a well-informed decision.

Below are some initial considerations about bankruptcy:

• Emotional impact: Acknowledging that deciding on bankruptcy can be emotionally challenging is essential.

• Future implications: It can significantly affect your credit rating, which may, in turn, impact borrowing ability and financial independence.

• Legal obligations: Bankruptcy is not merely a declaration of insolvency; it includes legal duties and constraints.

While the numbers highlight how common financial difficulties can be, bankruptcy is not the only solution. This guide will also cover alternatives such as Debt Relief Orders (DROs) and Individual Voluntary Arrangements (IVAs). Understanding the advantages and disadvantages of each option will help ensure that individuals choose the path that best fits their circumstances.

Understanding how bankruptcy works in the UK

The UK has a distinct legal framework governing bankruptcy, mainly outlined in the Insolvency Act 1986 and subsequent amendments. Under these regulations, bankruptcy is a court-based mechanism that aims to balance debtors’ need for relief with creditors’ rights to seek repayment. Although bankruptcy is a comprehensive solution, it is also a serious commitment that imposes certain limitations on personal and financial activities.

The legal framework

Bankruptcy in England and Wales is generally initiated through an online application, submitted by the debtor, or via a creditor petition to the court if the debt exceeds a certain threshold. The process differs slightly in Northern Ireland and Scotland, where separate legislation applies (in Scotland, bankruptcy is often referred to as “sequestration”). Nonetheless, the core principles remain consistent: the bankrupt’s assets are used to repay debts wherever possible, and once the bankruptcy term ends, outstanding qualifying debts are typically written off.

What happens when you are declared bankrupt

Once a bankruptcy order is granted, control of the bankrupt individual’s assets and financial affairs usually passes to the official receiver or appointed trustee. They will assess the assets and liabilities, liaise with creditors, and arrange for any available funds or property to be used toward paying off debts. During this time, the individual is subject to various restrictions on financial activities.

Depending on circumstances, a bankruptcy might last for a year, although certain obligations — such as the requirement to make payments (if your income allows) — can continue for up to three years under an Income Payments Agreement or Income Payments Order. Once the bankruptcy period ends, the debts included are typically discharged.

Important considerations

• Residency: You must either reside in England or Wales or have had a business or property there to apply under the English/Welsh system.

• Consequences for business owners: If you are self-employed, bankruptcy can affect your ability to operate your business.

• Joint debts: Bankruptcy pertains to an individual, not to couples jointly. If you hold joint debts, the other party remains liable.

A critical element in understanding the process is knowing your responsibilities once the bankruptcy order is in place. From cooperating fully with the official receiver to declaring all assets and debts honestly, adhering to these obligations can help you achieve a smoother, more efficient resolution of your financial affairs.

Points to reflect on

1. Will bankruptcy address all your debts, and are there any excluded debts (like fines, student loans, or maintenance payments)?

2. How might bankruptcy shape your future financial profile, especially in terms of creditworthiness?

3. What alternative debt solutions should you consider before committing to bankruptcy?

While bankruptcy offers many individuals a chance to reset their finances, it must be approached with a thorough understanding of the practical steps and long-term implications. By exploring each aspect carefully, you will be well-equipped to navigate the journey and rebuild a stable financial foundation afterward.

Who can apply for bankruptcy

Bankruptcy is not an exclusive measure for only those in severely distressed financial states. In fact, anyone who meets specific criteria and is unable to pay their debts can file for bankruptcy in England and Wales. However, certain eligibility requirements must be fulfilled, and considering all available options before committing to bankruptcy remains crucial.

The fundamental rule is that you must prove you are insolvent, meaning you are unable to meet your debt obligations as they fall due. This also encompasses situations where your total debts significantly exceed your total assets. If you meet this criterion, you can either apply voluntarily or be forced into bankruptcy through a creditor’s petition.

Eligibility criteria

• Insolvency: You must demonstrate that you cannot pay your debts.

• Residency: You must live, run a business, or have property in England or Wales.

• Debt amount: There is no official minimum debt threshold in personal applications, but creditors must be owed at least £5,000 to petition for your bankruptcy.

It’s worth noting that the rules for Northern Ireland and Scotland differ slightly, so if you reside or operate solely within those regions, you should consult the relevant legislation on sequestration (Scotland) or bankruptcy in Northern Ireland.

Exceptions and important details

• Previous bankruptcy: You can apply even if you have been bankrupt before, though the conditions and consequences could be more severe with repeated bankruptcies.

• Minors: Generally, individuals under 18 cannot be declared bankrupt; a separate set of rules may apply if debts involve minors.

• Mental capacity: If an individual lacks mental capacity, an application can sometimes be made on their behalf, though this is a complex area requiring specialist legal advice.

Quick reference table on who can apply for bankruptcy

Important subgroups

• Sole traders: If you are self-employed, you can apply for bankruptcy, but it can affect your capacity to trade.

• Partners in a partnership: A partnership’s dissolution may occur if a partner is declared bankrupt, but it can be varied depending on the partnership agreement.

• Company directors: If you are a director of a limited company, bankruptcy can disqualify you from acting in that capacity for a specified period.

By gathering information relevant to your specific circumstances, you can establish if bankruptcy is a suitable choice or if alternative remedies may offer a more constructive route. Ultimately, eligibility is not just a question of meeting legal thresholds; it’s also about determining whether the financial and personal implications align with your long-term goals.

The application process

Filing for bankruptcy is a formal process that requires precision and honesty when declaring your assets, liabilities, income, and expenses. The digital transformation of government services means most bankruptcy applications in England and Wales are now submitted online, streamlining the administrative aspects. Nevertheless, it remains a significant legal undertaking that should be prepared for thoroughly.

Preparing for your application

Start by assembling a clear overview of your finances. This often involves listing:

• All current debts (including secured and unsecured)

• All income sources (salary, benefits, pensions, self-employed income)

• Any assets (property, vehicles, personal valuables)

• A schedule of regular expenses (rent, utilities, food, transport)

Ensuring this information is accurate and up to date will help avoid delays or complications in your application. You’ll also need to pay the required fee, which can be split into instalments but must be paid in full before your application is submitted.

Step-by-step application

1. Online application: Access the official government portal for bankruptcy applications. You’ll be guided to fill in forms detailing your personal and financial circumstances.

2. Submit fee: The bankruptcy fee is usually paid online; it covers both court costs and administration by the Insolvency Service.

3. Assessment: Once your application is submitted, an adjudicator examines the details. They can either approve, reject, or request more information.

4. Order granted: If approved, you will receive a bankruptcy order, which signals the official beginning of the bankruptcy process.

What happens after submission

Upon the grant of a bankruptcy order, the official receiver is automatically notified. They will reach out to gather further information and arrange for an interview if necessary. It is vital to respond promptly and cooperate fully with their requests. The official receiver’s role includes investigating your financial affairs to ensure all debts, assets, and relevant circumstances are understood.

Dealing with creditors post-application

Once a bankruptcy order is in place, creditors should stop contacting you directly. Instead, they must work through the official receiver. This can provide immediate relief from phone calls, letters, and other demands for payment. However, you are legally obliged to inform the official receiver of any changes in your financial situation during the bankruptcy period.

Tips for a smooth application

• Seek advice: Consult with a qualified debt adviser or insolvency practitioner to clarify any uncertainties.

• Plan the timing: Sometimes, waiting a short while to gather all necessary documents can result in a stronger, more complete application.

• Maintain honesty: Any deception or omission of assets or debts can lead to serious legal repercussions and potentially prolong your bankruptcy.

Filing for bankruptcy is rarely a simple or casual decision. By understanding the nuances of the application procedure, you can avoid common pitfalls and give yourself the best chance of achieving a swift and fair resolution to your financial difficulties.

The role of the official receiver

The official receiver plays a central part in the bankruptcy framework in England and Wales. Appointed by the Insolvency Service, their primary function is to administer the bankrupt individual’s estate, protect creditors’ interests, and ensure the process adheres to legal protocols. Engaging openly and honestly with the official receiver is one of the most crucial elements in a successful bankruptcy proceeding.

Main responsibilities

• Investigating affairs: The official receiver delves into the bankrupt individual’s financial history, debts, and assets to form a complete picture.

• Managing assets: If there are any assets, the official receiver or appointed trustee may sell them to repay creditors.

• Income assessments: They can establish if you can contribute a portion of your income through an Income Payments Agreement (IPA) or Income Payments Order (IPO).

• Overseeing compliance: It’s the official receiver’s duty to ensure you follow bankruptcy rules and regulations, enforcing restrictions when necessary.

Communication and cooperation

Effective communication with the official receiver can help clarify procedures and expectations. You may be required to:

• Attend an interview: Typically over the phone or via videoconference, where they will ask for detailed information about your finances.

• Provide documentation: Bank statements, payslips, mortgage agreements, and more.

• Keep them updated: Any change in circumstances, such as a pay rise or an inheritance, must be reported.

Failure to cooperate can lead to extended restrictions or even legal consequences. Remember, the official receiver is there to oversee a fair and transparent process, ensuring creditors receive as much repayment as possible, and you, as the debtor, are treated according to the law.

What to expect from your official receiver

• Professional conduct: They must act impartially and within the boundaries of insolvency legislation.

• Clear guidelines: You should receive instructions on what is needed from you, how assets will be handled, and any steps you need to take next.

• Potential meetings: If your finances are complex, a face-to-face meeting might be arranged to address any outstanding questions.

Common concerns

• Loss of control: While it may feel unsettling to have someone else manage your financial affairs, the official receiver’s role is protective and procedural.

• Confidentiality: They are bound by confidentiality rules, although certain details about your bankruptcy may be published in the Individual Insolvency Register.

• Disputes: If you disagree with any aspect of the official receiver’s actions, you may have the option to seek legal advice or appeal decisions within the appropriate channels.

Working constructively with the official receiver can help minimise stress and keep the process moving forward. They ultimately act as a pivotal figure, ensuring the bankruptcy procedure is carried out ethically and efficiently for all parties involved.

Property, assets and possessions

A critical aspect of bankruptcy is how your property and other possessions are treated. When you are declared bankrupt, ownership and control of most of your assets pass to the official receiver or an appointed trustee. This measure aims to liquidate assets where feasible to repay creditors, though certain items are protected.

Assessing your assets

From a practical perspective, assets can include:

• Real estate (your home, investment properties, or inherited properties)

• Vehicles (cars, motorcycles, and any other form of personal transport)

• Personal valuables (jewellery, antiques, collectibles)

• Savings and investments (bank accounts, stocks, shares)

While some assets may be sold, others might be deemed exempt if they are necessary for everyday living or employment. For example, a modest car you need for commuting to work might be exempt, whereas a high-value car could be sold to generate funds.

Your home

Often the biggest concern for those considering bankruptcy is the family home. If you have significant equity in your property, the official receiver (or trustee) may seek to sell your home to free up funds to repay creditors. If the equity is minimal or negative, the trustee might delay taking action, giving you time to explore options such as buying back the beneficial interest or having a family member do so on your behalf.

Factors that can influence the treatment of your home:

1. Equity: The amount of equity in the property at the time of bankruptcy.

2. Joint ownership: If you own the home jointly with another person, only your share is part of the bankruptcy estate.

3. Protected tenants: If your living arrangements are governed by specific tenancy laws, your risk of losing the property may be lower.

Personal items

Most everyday household items are typically not sold, as they hold little resale value and are needed for normal living. However, expensive luxury items might be taken and sold for the benefit of creditors.

Pension and life insurance policies

• Pension funds: These are usually protected in bankruptcy, subject to certain conditions.

• Life insurance payout: If you receive a payout during the bankruptcy period, it may be treated as a windfall and used to repay creditors.

Illustrative scenarios

• Scenario 1: A homeowner with substantial equity: likely to face the sale of the property or an arrangement to release equity.

• Scenario 2: A homeowner in negative equity: less likely to lose the property immediately, though ongoing supervision applies.

• Scenario 3: Tenant with minimal assets: possessions might be protected if they serve no significant resale value.

Understanding how assets are handled can alleviate some anxiety about the process. It underscores the importance of being transparent and forthcoming with information on your property, possessions, and financial interests. By knowing which items may be retained and which could be sold, you can plan effectively for life during and after bankruptcy.

Dealing with debts and creditors

One of the core objectives of bankruptcy is to provide a fair resolution for creditors while offering individuals a fresh start. When you enter bankruptcy, your debts are effectively frozen, and you typically cease making direct payments to creditors. Instead, the official receiver or trustee takes responsibility for coordinating payments from any realised assets or available income.

How debts are managed

• Secured debts: Mortgages or car finance might be treated differently, as the creditor’s security can allow them to repossess the asset if payments are not maintained.

• Unsecured debts: Credit cards, personal loans, and overdrafts are usually included in the bankruptcy and are managed collectively by the official receiver.

• Priority debts: Certain debts, such as council tax or utility arrears, often have legal implications if unpaid. They are included, but the process for dealing with them might be prioritised.

During your bankruptcy, most creditors cannot pursue you directly for payment. Instead, they must interact with the official receiver or trustee, allowing you a degree of relief from ongoing demands. However, if you had debts that are not covered by bankruptcy — such as certain student loans, court fines, or child maintenance arrears — you remain responsible for these even after bankruptcy.

Communication with creditors

Prior to applying for bankruptcy, you may still receive letters or calls. Once you are declared bankrupt and the creditors are notified, they should stop contacting you. Nevertheless, keep records of any ongoing communication, as you might need to forward it to the official receiver.

Income Payments Agreements and Orders

If you have a surplus income after covering reasonable living expenses, you may be required to pay part of that surplus to your creditors over a set period (usually up to three years). This is done through an Income Payments Agreement (IPA) — voluntarily agreed upon with the official receiver — or an Income Payments Order (IPO) if it is court-mandated.

Tips for managing creditor interactions

1. Notify them promptly: Once bankruptcy is approved, supply your bankruptcy reference number to any creditor who contacts you.

2. Stay organised: Keep a folder of all letters and emails from creditors.

3. Check for errors: Occasionally, some debts might be missing from your bankruptcy application. Correct these oversights immediately by informing the official receiver.

By centralising debt management, bankruptcy can remove the stress of juggling multiple creditor demands. However, it also imposes strict rules regarding your income and assets. Understanding these regulations will ensure you remain on the right side of the process, enabling the best possible outcome for all involved.

Bankruptcy restrictions

When individuals declare bankruptcy, they gain relief from relentless creditor pressure. However, this relief comes with a set of restrictions affecting financial, business, and sometimes personal activities. These restrictions are designed to protect creditors and maintain public confidence in the insolvency system.

Overview of bankruptcy restrictions

• Bank accounts: Access to existing bank accounts can be frozen briefly, and banks may close your account. Opening a new basic account is possible, but with limitations.

• Borrowing money: If you wish to borrow more than £500, you must disclose your bankruptcy status to the lender.

• Business directorship: You cannot act as a director of a limited company without explicit court permission.

• Professional roles: Some professions or regulatory bodies have specific rules that may affect your ability to practise while bankrupt (e.g., solicitor, accountant).

Extended restrictions

In serious cases of misconduct, bankruptcy restrictions can be extended via a Bankruptcy Restriction Undertaking (BRU) or a Bankruptcy Restriction Order (BRO). These can last up to 15 years and are typically applied if you fail to cooperate with the official receiver, conceal assets, or accumulate debts through dishonest or reckless means.

Typical restrictions table

Real-world implications

• Career impact: If you work in certain regulated industries, bankruptcy may result in immediate dismissal or suspension of your licence to practise.

• Insurance premiums: Some insurance providers could view bankruptcy as a risk factor, potentially leading to increased premiums or exclusions.

• Property rental: Landlords may be reluctant to rent to individuals with a recent bankruptcy, requiring additional guarantors or upfront payments.

Compliance with these rules is non-negotiable. Failure to follow them can lead to additional penalties, including prosecution or extended bankruptcy terms. While these conditions might feel limiting, they play a key role in ensuring accountability and transparency throughout the insolvency process.

Costs and fees involved

Entering bankruptcy is not free. There are specific fees and costs that individuals must pay to commence the process. Understanding these charges beforehand helps you plan effectively and avoid any unexpected financial hurdles.

Bankruptcy application fee

You are required to pay a fee to cover:

1. Administration: The cost of processing your application and managing your bankruptcy.

2. Court fee: Although bankruptcy applications in England and Wales are largely online, a court fee can still form part of the overall expense.

As of recent guidelines, the total fee for an individual applying for bankruptcy in England and Wales is typically £680. This can be paid in instalments, but you must settle the full amount before your application can be submitted.

Additional costs

• Assets realisation: The official receiver or trustee may incur costs while selling assets, e.g., estate agent fees, auction costs, or legal fees. These expenses come out of the bankruptcy estate, reducing the funds available to creditors.

• Income Payment Agreement (IPA) or Order (IPO): While not strictly a “fee,” it is a financial commitment if you have disposable income.

• Professional advice: If you seek guidance from insolvency practitioners or solicitors, you may need to budget for their consultancy fees. Free and low-cost advice is also available through charities and not-for-profit agencies.

Possible fees

In some cases, individuals on certain benefits or low incomes might be exempt from part of the fee, or they might be able to apply for a remission. However, these exemptions are quite limited. Double-check current information on the government website or seek advice from charities specialising in debt relief.

Be wary of any organisation promising bankruptcy services for a hefty fee upfront. Often, official guidance is available at no cost, and legitimate debt charities can offer support to help you navigate the process. Making yourself aware of all costs reduces the chance of unwelcome surprises during an already challenging time.

The discharge process

The concept of “discharge” is central to bankruptcy, signifying the official conclusion of the procedure. When you are discharged, the majority of your outstanding debts that were included in the bankruptcy are written off, offering you a clean slate. This section clarifies how long it takes, what conditions apply, and how discharge can affect your life post-bankruptcy.

Standard discharge period

In England and Wales, discharge from bankruptcy typically occurs automatically 12 months after the date of the bankruptcy order, provided you have cooperated fully with the official receiver and complied with all requirements. If there are concerns about misconduct or incomplete disclosure of assets, your discharge can be delayed.

Early discharge

Early discharge used to be an option in limited cases, but it is now rarely granted. Changes in policy mean that the standard 12-month period usually applies. Regardless, remaining cooperative and transparent throughout the bankruptcy can help ensure the process concludes as smoothly and quickly as possible.

Post-discharge obligations

Even after discharge, some conditions may still apply:

• Income Payments Agreement (IPA): If one was established, you might need to continue payments for up to three years.

• Impact on credit file: Bankruptcy will stay on your credit reference file for six years from the bankruptcy order date.

• Restriction undertakings: If you entered into a Bankruptcy Restriction Undertaking (BRU) or were subject to a Bankruptcy Restriction Order (BRO), these limitations continue until the specified end date.

Benefits of discharge

• Debt relief: Most unsecured debts are completely cleared, allowing you to focus on the future rather than past obligations.

• Reduced creditor pressure: Creditors are no longer able to pursue you for debts included in the bankruptcy.

• Potential for financial reset: Discharge can be the first step in rebuilding a more stable financial life.

Staying informed

It is wise to keep the discharge letter or certificate, which confirms the official end of your bankruptcy. This document may be requested by future lenders, landlords, or employers as proof of your status. If you plan to borrow money, be transparent about your bankruptcy history, as failing to disclose it could lead to legal implications and damage any developing relationships with lenders.

The discharge process is the key milestone in bankruptcy, marking the point when you can fully look to the future with renewed financial autonomy. By maintaining compliance throughout your bankruptcy, you can emerge from the process equipped to handle your finances responsibly and proactively.

Impact on credit and borrowing

Bankruptcy has far-reaching implications for your credit file and future borrowing potential. While it provides a route out of overwhelming debt, it also leaves a visible footprint on your financial history, influencing everything from credit card applications to mortgage opportunities.

Effect on your credit report

Upon the granting of a bankruptcy order, credit reference agencies record the event and maintain this information on your file for six years from the date of the order. During this period:

• Credit scores typically drop: Lenders see bankruptcy as a significant risk indicator, resulting in lower credit scores.

• Loan approvals can be difficult: Mainstream banks may be hesitant to offer conventional loans or credit facilities.

• Future interest rates may be higher: If you do secure credit, you might face above-average interest rates.

Rebuilding your credit profile

Although rebuilding credit after bankruptcy can be challenging, it is by no means impossible. Many individuals use credit-building strategies, such as:

• Credit builder credit cards: Providers offer these to people with poor or limited credit histories, albeit with higher interest rates.

• Small forms of credit: Responsible use of small overdrafts or mobile phone contracts can show lenders you are managing repayments effectively.

• Consistent bill payments: Maintaining on-time payments for utilities, rent, and other recurring costs helps establish reliability.

Mortgage considerations

Securing a mortgage post-bankruptcy can be more complex. While a discharged bankruptcy doesn’t automatically prevent you from obtaining a mortgage, lenders may require you to wait a certain number of years (often two to three) after discharge. A larger deposit — in some cases 15% to 25% of the property’s value — might also be necessary to offset the perceived risk.

Practical steps

1. Check your credit report: Ensure all the bankruptcy information is accurate and that any debts included in the bankruptcy are marked correctly.

2. Avoid unnecessary applications: Multiple credit applications in a short time can further lower your credit score.

3. Budget carefully: Sound financial management can be evidenced through regular savings or stable spending patterns.

Bankruptcy does not forever close the door to borrowing, but it does impose a period of restricted financial engagement. With a disciplined approach, patience, and an understanding of how credit scoring works, you can gradually restore a credible financial standing and re-enter the credit market more responsibly.

Alternatives to bankruptcy

Although bankruptcy can offer a fresh start, it is a major step with serious consequences. If your financial situation allows for alternative solutions, exploring them thoroughly can help you avoid some of the long-term restrictions that come with bankruptcy. Each option has its unique advantages and disadvantages, and the most suitable path will depend on your specific situation.

Individual voluntary arrangement (IVA)

An IVA is a legally binding agreement between you and your creditors to repay a portion of your debt over a set period, usually five years. An insolvency practitioner manages the arrangement, negotiating a payment plan that reflects your disposable income.

• Advantages: Less severe impact on credit rating than bankruptcy, potential to retain assets like your home, structured payments.

• Disadvantages: You must adhere strictly to the payment plan, fees are involved, and failure to comply can lead to bankruptcy.

Debt relief order (DRO)

A DRO is designed for individuals with low income, minimal assets, and debts below a certain threshold (currently £20,000 in England and Wales). For those who qualify, debts included in the DRO are typically written off after 12 months, provided your financial circumstances do not improve.

• Advantages: Low cost, straightforward, no court appearance.

• Disadvantages: Not suitable for those with higher levels of debt or substantial assets, restrictions still apply during the 12-month period.

Debt management plan (DMP)

A DMP is an informal arrangement with your creditors to repay your debts in full but usually at a reduced monthly rate. DMPs are not legally binding, but they can provide breathing space if you just need more time to repay.

• Advantages: Flexible, no court involvement, possible to adjust payments if circumstances change.

• Disadvantages: Creditors can still take legal action, no guarantee of interest or charges being frozen, repayment could stretch over a long period.

Administration order

If you have debts below a specific threshold (currently £5,000) and at least one county court judgment (CCJ) against you, an administration order is another court-based solution. You make a single regular payment to the court, which then distributes it among your creditors.

• Advantages: Legal protection from further creditor action, manageable single payment.

• Disadvantages: Only available for limited debts, fees deducted from payments.

Before committing to bankruptcy, consider discussing your situation with a qualified debt adviser or insolvency practitioner. They can guide you through the pros and cons of each alternative, ensuring that whichever route you choose aligns with your financial goals and personal well-being.

Rebuilding your finances and credit

Emerging from bankruptcy offers a valuable chance to reset and fortify your financial foundation. However, starting over requires deliberate, disciplined steps to protect yourself from future instability and regain lender confidence. This section outlines a roadmap for rebuilding finances and creditworthiness in the post-bankruptcy landscape.

Setting realistic goals

Begin by identifying what you want to achieve financially in the short, medium, and long term. Your goals might include saving for an emergency fund, consolidating any remaining obligations, or preparing for significant future investments such as a mortgage. Having well-defined targets can help motivate consistent financial behaviour.

Budgeting and money management

A carefully structured budget is the backbone of financial recovery.

• Track expenses: Make note of every outgoing, including small purchases that can add up over time.

• Automate savings: If possible, set up a standing order to transfer a portion of your income into a separate savings account each month.

• Cut unnecessary costs: Review subscriptions, direct debits, and lifestyle choices that may be draining your funds.

Gradual credit-building strategies

Rebuilding credit after bankruptcy involves demonstrating responsible financial behaviour.

• Credit builder cards: These often come with higher interest rates, but prompt, full repayment every month can gradually improve your credit rating.

• Regular bill payments: Consider using direct debits for utilities, mobile phone bills, and other essentials to showcase consistent repayment history.

• Stable employment: A reliable source of income positively influences lenders when they assess your credit applications.

Protecting your financial progress

• Regular financial check-ups: Schedule periodic reviews of your budget and credit file.

• Use credit responsibly: Avoid large borrowing until you can prove stable repayment habits.

• Be transparent: If applying for a new financial product, be honest about your bankruptcy status when required.

Rebuilding finances after bankruptcy is a journey that demands patience and perseverance. Success depends on consistent good habits, informed decision-making, and a willingness to adapt as circumstances change. With a clear plan and constructive approach, many individuals find themselves on a sturdier financial footing than ever before.

Getting professional advice

While it is entirely possible to navigate bankruptcy independently, professional advice can significantly ease the journey and ensure you make informed, strategic decisions. Advisors, whether from a charity or a specialist insolvency practice, bring expertise that can clarify the complexities of debt solutions, legal obligations, and long-term financial strategies.

Types of advice providers

1. Debt charities: Organisations like StepChange or National Debtline offer free, impartial advice on budgeting, debt solutions, and emotional support.

2. Insolvency practitioners: Regulated professionals authorised to act on formal insolvency processes such as IVAs or bankruptcy.

3. Solicitors: Legal experts might be useful if your bankruptcy involves assets, disputes, or more complex arrangements.

Benefits of expert guidance

• Clarifying complex terms: Legal jargon and financial nuances can be overwhelming; experts break these down into understandable points.

• Tailored solutions: No two financial situations are the same, so professional advisors tailor their recommendations to your specific circumstances.

• Negotiating power: Some professionals can negotiate better terms with creditors or help arrange alternative debt solutions.

Questions to ask an adviser

1. Experience: Do they specialise in bankruptcy or broader debt management?

2. Fees: If fees apply, how are they structured, and is there a free initial consultation?

3. Credentials: Are they regulated or affiliated with recognised bodies like the Institute of Chartered Accountants in England and Wales (ICAEW) or Insolvency Practitioners Association (IPA)?

When to seek help

• Before filing for bankruptcy: Discuss all possible solutions, weigh pros and cons, and ensure you fully understand the repercussions.

• During bankruptcy: If you encounter issues with the official receiver or disputes with creditors, professional advice can provide clarity.

• Post-bankruptcy: A financial coach or debt counsellor could guide you on rebuilding credit and maintaining stability.

By seeking qualified support, you gain not just technical expertise but also reassurance that you are making the best decisions for your situation. The journey toward financial recovery is often smoother, quicker, and less stressful when navigated alongside someone who fully understands the process.

Conclusion

Bankruptcy in the UK is a structured legal process designed to offer individuals relief from overwhelming debts while ensuring fair treatment for creditors. Though it can feel like a drastic measure, bankruptcy also provides a genuine opportunity for a fresh start. By understanding how the procedure works, who qualifies, and what the implications are, you can make decisions that align with your financial needs and personal goals.

Throughout this guide, we have explored:

• The fundamentals of the bankruptcy process, from application to discharge.

• The role of the official receiver, including the responsibilities they hold over your assets and income.

• How debts and creditors are managed, alongside the restrictions imposed during bankruptcy.

• Fees, potential alternatives, and strategies for rebuilding credit and overall financial health.

Facing significant debt can be stressful and isolating, yet it is important to remember that thousands of people in the UK navigate this process successfully each year. Bankruptcy is not the only option, and it may not be suitable for everyone. Whether it is an IVA, DRO, or a more informal arrangement, there are multiple solutions that can offer breathing space and structured repayment.

Ultimately, knowledge is power when dealing with complex legal and financial matters. As you reflect on your unique circumstances, consider seeking professional advice if any aspect of the bankruptcy process remains unclear. An informed approach will maximise your chances of achieving the best possible outcome and pave the way for a stable, debt-free future.

Frequently asked questions

General understanding

What exactly is bankruptcy?

Bankruptcy is a legal procedure designed to help individuals who cannot pay their debts. In the UK, it provides relief from most creditor actions, but involves placing your financial affairs under the supervision of an official receiver or trustee for a set period. It also comes with certain restrictions, so it is crucial to understand both the benefits and consequences before proceeding.

How does bankruptcy differ from other debt solutions?

Bankruptcy immediately addresses unsecured debt by placing control of your assets and financial decisions in the hands of an official receiver. In contrast, debt solutions like Individual Voluntary Arrangements (IVAs) or Debt Management Plans (DMPs) allow you to retain more control of your assets, but often require regular repayments over a longer timeframe.

Does bankruptcy cover every debt type?

Most unsecured debts, such as credit card balances and personal loans, fall under bankruptcy. However, some debts, like court fines, child maintenance, and certain student loans, are excluded. It is important to confirm whether your specific liabilities can be wiped out by bankruptcy.

Eligibility

Who qualifies for bankruptcy in the UK?

Generally, you must be insolvent — unable to pay your debts as they fall due — and you should live, have a property, or run a business in England or Wales. If you are based in Scotland or Northern Ireland, the rules differ slightly (in Scotland, the process is known as “sequestration”).

Can I be forced into bankruptcy?

Yes, if a creditor is owed £5,000 or more, they can petition the court to declare you bankrupt. This is often a last resort for creditors. If you receive a petition, it is advisable to seek immediate professional help to explore whether there are viable alternatives before the court order is granted.

Can I apply for bankruptcy if I have been bankrupt before?

Yes. Previous bankruptcies do not bar you from applying again, but repeated bankruptcies can lead to longer restrictions or extended scrutiny by the official receiver. Frequent bankruptcies may also have a more damaging impact on your credit history and future borrowing.

Application process

How do I start the bankruptcy application?

In England and Wales, you typically complete an online application form through the government’s bankruptcy portal. You must also pay a fee before submitting. An adjudicator will then review your case and decide whether to grant a bankruptcy order.

What information is needed for the form?

You must provide details about your personal circumstances, income, debts, assets, and ongoing expenses. Honesty and clarity are essential; inaccurate or incomplete information can cause delays or even legal consequences.

How long does it take to get a bankruptcy order?

Once your fee is paid and the application is submitted online, decisions are generally made quickly — often within a few days. If the adjudicator needs more details, they will contact you. The process can be longer if complex situations or disputes arise.

Assets and possessions

Will I lose my home if I go bankrupt?

If you have significant equity in your property, the official receiver or trustee might decide to sell it to pay creditors. However, if your home has little or no equity, selling may be delayed or avoided. In some cases, a family member or friend can “buy out” your share of the equity to prevent the property from being sold.

Can I keep my car during bankruptcy?

If the vehicle is reasonably priced and essential for work or daily living, you may be allowed to keep it. If the car is of high value, the official receiver might decide to sell it and provide you with funds to buy a more modest replacement.

What happens to my personal belongings?

Most everyday household goods have limited resale value and are usually exempt. Items considered luxury or significantly valuable (like expensive jewellery or artwork) might be sold to contribute towards your debts.

Finances during bankruptcy

Do I still need to pay creditors after I am declared bankrupt?

Once the bankruptcy order is granted, you typically stop paying most unsecured creditors directly. They should contact the official receiver or trustee for any payments. However, if you have secured debts, such as a mortgage, you should continue making those payments unless advised otherwise.

What is an Income Payments Agreement (IPA)?

An IPA is a formal arrangement to pay any surplus income you may have to the official receiver for up to three years. If you cannot agree on a voluntary IPA, the court may impose an Income Payments Order (IPO) instead. These payments help repay some or all of your debts.

How do I handle ongoing living costs during bankruptcy?

You will still be allowed sufficient funds to cover reasonable living expenses, including rent, utilities, and basic necessities. The official receiver reviews your income and expenses to determine what is deemed “reasonable,” helping ensure you have enough to meet essential outgoings.

Discharge and after

What does “discharge” mean in bankruptcy terms?

Discharge is the legal release from most debts included in the bankruptcy. In England and Wales, most individuals are discharged automatically after 12 months, provided they comply with all the requirements and fully cooperate with the official receiver.

Does discharge mean I am fully debt-free?

Most unsecured debts included in your bankruptcy are written off when you are discharged. However, certain debts (like child maintenance and some student loans) remain payable. Discharge lifts the bankruptcy restrictions, but you may still need to fulfil any existing Income Payments Agreement until it ends.

Can my discharge be delayed?

Yes, the official receiver or a court can suspend or delay your discharge if you fail to cooperate or if there is evidence of misconduct. In serious cases, you may face extended bankruptcy restrictions via a Bankruptcy Restriction Order (BRO).

Credit impact

How long will bankruptcy stay on my credit record?

Bankruptcy usually appears on your credit file for six years from the date of the bankruptcy order. This can affect your ability to secure loans, mortgages, or other credit-based products during that time.

Can I apply for credit after bankruptcy?

Yes, you can, but lenders are generally cautious and may charge higher interest rates or require a guarantor. You must disclose your bankruptcy if seeking more than £500 in credit. Over time, responsible borrowing and prompt repayments can help rebuild your credit profile.

Will I ever be able to get a mortgage post-bankruptcy?

Obtaining a mortgage after bankruptcy is possible, though many lenders will wait until a certain period (often two to three years) post-discharge. You may also be required to provide a larger deposit. Demonstrating stable employment and a healthy track record of managing credit since discharge is key to success.

Legal aspects

What restrictions apply when I am bankrupt?

During bankruptcy, you cannot borrow more than £500 without disclosing your bankruptcy status. You cannot act as a company director without the court’s permission, and some professional bodies may restrict membership for bankrupt individuals.

What is a Bankruptcy Restriction Undertaking (BRU)?

A BRU is a voluntary agreement extending certain bankruptcy restrictions for a specified period if there has been misconduct. Unlike a court-imposed order, it allows the individual to avoid formal proceedings but still carry extended restrictions.

Do I need to attend court for bankruptcy?

For most self-filed bankruptcies in England and Wales, the process is handled online, and there is no requirement to appear in court. Creditors petitioning for your bankruptcy, however, may involve a court hearing where you have the chance to respond.

Practical concerns

How public is my bankruptcy?

Bankruptcy details are listed in the Individual Insolvency Register, which is publicly accessible. A notice of your bankruptcy may also appear in The Gazette. However, this does not typically lead to broad media coverage unless there is a high-profile element involved.

Will my employer or landlord be informed?

Employers are not usually contacted directly unless it relates to your job requirements (for instance, regulated financial roles). Landlords may discover your bankruptcy when checking credit references, but no formal notification is sent.

Can I travel or move abroad during bankruptcy?

Travel is usually allowed, but you may need permission from the official receiver for extended trips or international moves. If you relocate, you must keep the official receiver informed of your contact details and continue cooperating with any ongoing bankruptcy obligations.

What happens if I receive an inheritance during bankruptcy?

Any inheritance received while you are bankrupt normally becomes part of the bankruptcy estate. You must inform the official receiver promptly, and those funds could be used to pay off your creditors.

Alternatives

Why might I choose an IVA over bankruptcy?

An IVA can allow you to keep your home and maintain greater control of your finances, as it does not involve the immediate sale of assets. However, it typically requires a longer period of monthly payments than bankruptcy and is only viable if you have a stable income to meet the agreed repayment schedule.

Do I qualify for a Debt Relief Order (DRO)?

A DRO is designed for individuals with debts below a certain threshold, low income, and minimal assets. It is cheaper than bankruptcy and usually only lasts 12 months, but eligibility criteria are strict and exclude certain types of debts and higher levels of personal liability.

Emotional wellbeing

How do I cope with the stress of filing for bankruptcy?

The stress and emotional strain of bankruptcy can be significant. Speaking to a mental health professional, a trusted friend, or a support organisation can ease the burden. Practical help from free debt advice services can also lessen anxiety by clarifying the steps involved.

Where can I find emotional and practical support?

Organisations like Citizens Advice, StepChange, and National Debtline offer free guidance. Additionally, some local community groups or charities may provide counselling and support tailored to those experiencing debt-related stress. Engaging with these resources helps you feel less isolated and more empowered.

Still have questions?

If you still feel uncertain about whether bankruptcy is right for you, or if you have unique circumstances not covered in this guide, consider speaking directly with an expert for tailored advice and guidance.

Glossary

Adjudicator

An adjudicator reviews bankruptcy applications in England and Wales. They have the authority to grant, reject, or request further information about a bankruptcy petition, ensuring the process meets legal requirements before issuing a bankruptcy order.

Administration order

An administration order is a court-approved arrangement for people with debts not exceeding a certain threshold (currently £5,000) who have at least one unpaid county court judgment (CCJ). Under this order, a single monthly payment is made to the court, which distributes it among creditors.

Annulment

Annulment is the legal cancellation of a bankruptcy order. This can occur if the debts are repaid in full, if the order should never have been made in the first place, or if an Individual Voluntary Arrangement (IVA) is agreed shortly after bankruptcy was declared.

Assets

Assets include anything of monetary value owned by an individual, such as cash, property, vehicles, investments, and valuable personal possessions. In bankruptcy, these items may be sold or used to repay creditors, except for certain exempt goods needed for daily living or employment.

Bankruptcy

Bankruptcy is a formal legal procedure intended to help individuals who cannot repay their debts. It involves transferring control of assets to an official receiver or trustee, who may sell them to pay creditors. Once discharged, most remaining unsecured debts are written off.

Bankruptcy application fee

This fee is paid to cover both the court and administration costs of filing for bankruptcy. In England and Wales, it typically totals £680, which must be paid in full before the online application can be submitted.

Bankruptcy restrictions

Bankruptcy restrictions apply during your bankruptcy term, limiting activities such as borrowing more than £500 without disclosure or acting as a company director. These are designed to protect creditors and maintain confidence in the insolvency system.

Bankruptcy Restriction Order

A Bankruptcy Restriction Order (BRO) extends the period of certain bankruptcy restrictions, potentially up to 15 years. Courts impose BROs when there is evidence of misconduct by the bankrupt individual, such as fraud or failing to cooperate with the official receiver.

Bankruptcy Restriction Undertaking

A Bankruptcy Restriction Undertaking (BRU) is a voluntary agreement in which the bankrupt person accepts extended restrictions without going to court. It has the same effect as a BRO but is entered into by mutual consent rather than being imposed by a judge.

Beneficial interest

Beneficial interest refers to the right to benefit from property or assets even if legal title is held by someone else. In bankruptcy, the official receiver may deal with the bankrupt’s beneficial interest in a property to help repay creditors.

County Court Judgment

A County Court Judgment (CCJ) is a court order issued if you fail to repay a debt. This can significantly affect your credit rating. Multiple CCJs or large outstanding amounts may lead creditors to consider petitioning for your bankruptcy.

Creditor

A creditor is any person or organisation you owe money to. In bankruptcy, creditors must generally cease direct collection efforts against you once a bankruptcy order is in place, instead working with the official receiver or trustee to receive any repayments.

Creditor petition

A creditor petition is where a creditor owed at least £5,000 applies to the court to make you bankrupt. This legal step usually follows repeated unsuccessful attempts to recover the debt and requires a court hearing if you challenge the petition.

Debt Management Plan

A Debt Management Plan (DMP) is an informal agreement with creditors to repay debts at a reduced monthly amount. Unlike bankruptcy, it does not write off any debt, and creditors may still take legal action if they are dissatisfied with the terms.

Debt Relief Order

A Debt Relief Order (DRO) is a form of insolvency for those with relatively low debts (under a set threshold), minimal assets, and limited income. If accepted, creditors included in the DRO cannot pursue you for payment during the 12-month moratorium, and outstanding debts are typically written off at the end.

Debtor

The debtor is the individual who owes money. In the context of bankruptcy, they are the person whose financial affairs become subject to control by the official receiver or trustee once a bankruptcy order is made.

Discharge

Discharge is when you are officially released from your bankruptcy obligations and most of the debts included in the procedure. In England and Wales, discharge usually happens automatically 12 months after the bankruptcy order, provided there is full compliance with requirements.

Disposable income

Disposable income is the amount of money left after covering essential living costs such as rent, utilities, and food. In bankruptcy, if you have any surplus disposable income, you may be required to contribute towards an Income Payments Agreement (IPA) or Order (IPO).

Equity

Equity is the net value of an asset after subtracting any debts secured against it. For instance, the equity in a house is the property’s market value minus any outstanding mortgage balance. High equity in a home can lead the trustee to consider a sale to repay creditors.

Estate

An individual’s estate encompasses all assets and liabilities, including property, possessions, and owed debts. During bankruptcy, control of the debtor’s estate typically transfers to the official receiver or a trustee to be managed and used to pay creditors.

Financial Conduct Authority

The Financial Conduct Authority (FCA) is the regulatory body overseeing financial services in the UK. Its remit includes safeguarding consumers and ensuring lenders act responsibly, playing a role in the broader financial ecosystem related to debt solutions.

Garnishment

Garnishment is a legal process allowing creditors to collect money directly from a debtor’s wages or bank account. In the UK, this may occur through an Attachment of Earnings Order. However, once bankruptcy is in place, garnishment orders generally cease for unsecured debts.

Guarantor

A guarantor is someone who agrees to repay a debt if the primary borrower cannot. Bankruptcy of the main borrower does not necessarily free the guarantor from responsibility for repaying the outstanding balance.

Harassment

Harassment by creditors occurs when they repeatedly contact or threaten you with legal action beyond reasonable attempts to recover a debt. Once bankruptcy is declared, creditors should direct all communications to the official receiver, reducing harassing contact.

Income Payments Agreement

An Income Payments Agreement (IPA) is a voluntary arrangement between you and the official receiver to use part of your disposable income to repay debts. It typically lasts three years and can reduce the overall impact on creditors who might otherwise receive less in bankruptcy.

Income Payments Order

An Income Payments Order (IPO) is similar to an IPA but is imposed by a court if you cannot reach a voluntary agreement. It requires you to contribute a portion of your surplus income towards your debts for up to three years.

Individual Insolvency Register

The Individual Insolvency Register is an online database listing individuals in formal insolvency procedures in England and Wales, including bankruptcies, Debt Relief Orders, and IVAs. Entries remain for a set time, making this information publicly accessible.

Individual Voluntary Arrangement

An Individual Voluntary Arrangement (IVA) is a formal agreement between you and your creditors to repay part of your debts over a fixed period, usually five years. An insolvency practitioner supervises the IVA, and if you comply fully, any remaining debts are written off at the end.

Insolvency

Insolvency means you are unable to pay your debts when they become due. Bankruptcy is one way to address insolvency, but alternatives include IVAs, Debt Relief Orders, and other arrangements based on your financial circumstances.

Insolvency Act 1986

The Insolvency Act 1986 is the principal legislation governing personal and corporate insolvency in England and Wales. It sets out the rules and procedures for bankruptcy, IVAs, liquidation, and other insolvency processes.

Insolvency Practitioner

An insolvency practitioner (IP) is a regulated professional authorised to manage insolvency procedures like IVAs or bankruptcies. They provide expert advice, handle negotiations with creditors, and supervise the arrangement once it is approved.

Insolvency Service

The Insolvency Service is a government agency responsible for implementing insolvency legislation and regulating the insolvency profession in England, Wales, and Northern Ireland. It also investigates possible misconduct and manages the official receivers.

Joint liability

Joint liability arises when two or more people are responsible for a single debt. In bankruptcy, only the bankrupt individual’s share of the debt is addressed, leaving the other liable party still responsible for repaying the outstanding balance.

Legal proceedings

Legal proceedings involve court actions taken to resolve disputes or enforce legal rights. In a debt context, this could include seeking a court judgment, enforcing a debt via bailiffs, or petitioning for a debtor’s bankruptcy.

Liquidation

Liquidation refers to winding up a company’s affairs by selling off its assets to repay creditors. Personal bankruptcy is sometimes compared to liquidation, as assets may be sold for the benefit of creditors, though the procedures and legal frameworks differ.

Moratorium

A moratorium is a legal pause on debt enforcement actions. When you apply for certain insolvency solutions, like an IVA, you may receive an interim moratorium that prevents creditors from taking further steps against you until a final decision is made.

Official receiver

An official receiver is an officer of the court and an employee of the Insolvency Service who oversees bankruptcies and certain other insolvencies. They investigate your financial affairs, recover assets, and distribute payments to creditors.

Petition

A petition is a formal request to the court to begin insolvency proceedings. In bankruptcy, this might be filed by the debtor (debtor’s petition) or by a creditor owed at least £5,000 (creditor’s petition).

Preferential creditor

A preferential creditor is a creditor who, by law, is entitled to receive payment before unsecured creditors. In personal insolvency, preferential creditors can include employees owed wages, though this primarily applies in corporate insolvencies.

Proof of debt

A proof of debt is a formal statement submitted by a creditor outlining the amount owed. In bankruptcy, creditors must provide a proof of debt to claim part of the bankrupt’s estate if available funds are distributed.

Property trustee

A property trustee is appointed to handle certain property matters in bankruptcy, especially if the bankrupt estate includes real estate. They may sell or transfer ownership to generate funds for creditors.

Realisation of assets

Realisation of assets is the process of converting a bankrupt individual’s assets into cash, typically by selling property or valuable possessions. The proceeds are then used to pay creditors according to their ranking in the insolvency process.

Secured debt

Secured debt is backed by collateral, such as a mortgage or car finance, giving the lender the right to repossess the asset if repayments are not maintained. These debts can continue outside of bankruptcy unless arrangements are made to surrender or sell the secured property.

Statement of affairs

A statement of affairs is a comprehensive document detailing all debts, assets, income, and expenses. It provides a clear overview of your financial position and is a key component in insolvency proceedings like bankruptcy or IVAs.

Trustee

A trustee is the person (often the official receiver or an insolvency practitioner) appointed to manage a bankrupt’s estate. They take control of the bankrupt’s assets, oversee any sale, and distribute proceeds to creditors.

Unsecured debt

Unsecured debt has no specific asset tied to it as collateral. Common examples include credit card balances, personal loans, and overdrafts. Bankruptcy typically covers these debts, with the official receiver distributing any available funds to repay them.

Voluntary arrangement

A voluntary arrangement is an agreement between a debtor and creditors to repay debts under mutually acceptable terms. IVAs are a specific, legally binding type of voluntary arrangement; informal debt management plans can also be arranged voluntarily without court involvement.

Winding-up petition

A winding-up petition is a creditor’s request to the court to liquidate a company when it cannot pay its debts. While distinct from personal bankruptcy, the principles of insolvency law apply similarly, focusing on asset realisation for creditor repayment.

Useful organisations

Insolvency Service

The Insolvency Service is a government agency responsible for overseeing bankruptcies, administering debt relief solutions, and investigating misconduct in insolvency cases. They provide guidance on the official processes and ensure that both debtors and creditors are treated fairly under UK insolvency law.

• 0300 678 0015

• www.gov.uk/government/organisations/insolvency-service

Citizens Advice

Citizens Advice offers free, independent guidance on a range of issues, including debt, benefits, and legal rights. Their trained advisers can help you understand your options if you are considering bankruptcy and point you towards tailored support and additional resources.

• 0800 144 8848

• www.citizensadvice.org.uk

StepChange Debt Charity

StepChange Debt Charity provides expert debt advice and can help individuals set up solutions such as Debt Management Plans or explore whether bankruptcy is appropriate. Their confidential service aims to guide you through every stage of resolving debt difficulties.

• 0800 138 1111

• www.stepchange.org

National Debtline

National Debtline is a dedicated helpline offering free and impartial debt advice to people in England, Wales, and Scotland. Their team can explain the bankruptcy process, discuss alternative debt solutions, and equip you with practical steps to manage your finances.

• 0808 808 4000

• www.nationaldebtline.org

MoneyHelper

MoneyHelper is a government-backed organisation offering straightforward financial guidance on topics such as budgeting, saving, and dealing with debt. Their website and helpline provide information to help you explore all options, including bankruptcy, in a clear and unbiased way.

• 0800 138 7777

• www.moneyhelper.org.uk

All references

Citizens Advice (2021) ‘Self-employed and debt advice.’
https://www.citizensadvice.org.uk/debt-and-money/self-help/self-employed-debt-advice/

Citizens Advice (2022) ‘Volunteer-led support for debt advice.’
https://www.citizensadvice.org.uk/about-us/how-citizens-advice-works/support-for-advisers/volunteer-led-support-for-debt-advice/

Financial Conduct Authority (2019) ‘Consumer Credit Sourcebook and Responsible Lending.’
https://www.handbook.fca.org.uk/handbook/CONC/

GOV.UK (2022) ‘Bankruptcy fees in England and Wales.’
https://www.gov.uk/bankruptcy/bankruptcy-fees

Legislation.gov.uk (1986) ‘Insolvency Act 1986.’
https://www.legislation.gov.uk/ukpga/1986/45/contents

MoneyHelper (2021) ‘Guide to dealing with debt.’
https://www.moneyhelper.org.uk/en/money-troubles/dealing-with-debt

Office for National Statistics (2019) ‘Household spending report.’
https://www.ons.gov.uk/peoplepopulationandcommunity/personalandhouseholdfinances/expenditure

The Insolvency Service (2020) ‘Annual Insolvency Statistics.’
https://www.gov.uk/government/statistics/insolvency-statistics

The Insolvency Service (2021) ‘Guidance on Bankruptcy Restrictions.’
https://www.gov.uk/government/publications/bankruptcy-restrictions/bankruptcy-restrictions

The Insolvency Service (2022) ‘Official Insolvency Statistics.’
https://www.gov.uk/government/collections/insolvency-service-official-statistics

The Money Charity (2022) ‘Average household debt statistics.’
https://themoneycharity.org.uk/money-statistics/

Disclaimer

The information provided in this guide is for general informational purposes only and does not constitute professional dental advice. While the content is prepared and backed by a qualified dentist (the “Author”), neither Clearwise nor the Author shall be held liable for any errors, omissions, or outcomes arising from the use of this information. Every individual’s dental situation is unique, and readers should consult with a qualified dentist for personalised advice and treatment plans.

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