You can declare yourself bankrupt by making an application to the government, which can be done online. The application costs £680 and you will need to provide information of your income, expenses, assets, and debts. An ‘adjudicator’ will then review the information and decide whether you meet the requirements to be declared bankrupt.

Bankruptcy lasts for 12 months and most, if not all, of your debts will be written off. Being declared bankrupt means you will not pay anything towards your debts, and you will not be contacted by people or companies you owe money to. Instead, the court will deal with queries from the people or companies you owe money to.

It is important to note that when you are declared bankrupt, some of your assets i.e. the things you own, may be sold to pay towards your debts. This includes property if you own a share that is worth more than £1,000. This may be done even if you or your family need the property. The decision ultimately lies with the courts.

When you are bankrupt, you will need to follow certain restrictions, as follows:

  • You cannot borrow more than £500 without informing the lender you are bankrupt.
  • You cannot be a director of a company unless the court gives you permission.
  • You cannot form, manage or promote a company unless the court gives you permission.
  • You cannot manage a business with a different name without telling people that you are bankrupt.
  • You cannot work as an insolvency practitioner.

It is regarded as a criminal offence if you do not follow these restrictions meaning you could be charged and taken to court.

Bankruptcy can be damaging to you and your family, so it is important that you check if there are other ways of dealing with your debt such as a Debt Management Plan or Individual Voluntary Arrangement.

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