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Frequently
Asked Questions (FAQ)
Listed below are
some of our most commonly asked questions. A further list is available
of frequently asked questions on the
Enterprise Act 2002. For further information you may find
the information you are looking for in one of our publications.
Please click on the relevant question to
find a brief answer. If your question
is not listed please e-mail your query to our Insolvency Enquiry Line at
, click here
for an online form.
Can
the Official Receiver or his staff give advice as to whether it is
appropriate for an individual to file his petition in bankruptcy?
Can
the Official Receiver and his staff advise whether it is appropriate for
an individual director to petition to the court for a
winding-up order against a company in which he/she has an interest?
I
have obtained my discharge, but am still unable to obtain credit, as my
name is included on a credit reference agency's records. Will the
Official Receiver arrange for the removal of the listing as I now have
my discharge?
How
do I make myself bankrupt?
How
do I make someone else bankrupt?
Can
I have a bank account?
Can
a bankrupt still trade?
I
am an employee of an insolvent. Am I allowed to claim wages?
When
will I be discharged?
How
do I obtain a certificate of discharge?
How
do I apply for a job with The Insolvency Service?
If I am made
bankrupt, will I still have to repay my student loan?
What is a
centre of main interest?
If my house is sold
sometime after the bankruptcy order is any shortfall on the mortgage
still a debt in my bankruptcy?
I am based in
England and Wales and I am owed money by someone who is subject to
insolvency proceedings in another country, how can I let the person
dealing with the proceedings know about my claim?
I do not live in England and Wales but in another country where I
have a lot of debts. Can I go bankrupt in England or Wales and
write off the debts in the country where I live?
|
Question |
Can
the Official Receiver or his or her staff give advice as to
whether it is appropriate for an individual to file his or her
petition in bankruptcy? |
| Answer |
The
Official Receiver and his or her staff cannot give advice as to
whether or not an individual should file his or her own petition
in bankruptcy. If that individual needs independent advice, then
they should consult a solicitor, accountant, licensed insolvency
practitioner, Citizens Advice, or another suitable person.
You may also find
it helpful to read the Insolvency Service publications titled 'Guide
to Bankruptcy' and 'Dealing
with Debt - How to petition for your own bankruptcy'
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|
Question |
Can
the Official Receiver and his or her staff advise whether it is
appropriate for an individual director to petition to the court
for a winding-up order to be made against a company in which
he or she has an interest? |
| Answer |
The
Official Receiver and his or her staff cannot advise directors as
to whether it is appropriate for them to seek a Winding-up Order
against a company in which they have an interest, but they should
approach a solicitor, accountant, licensed insolvency practitioner
or Citizens Advice to get independent advice.
You may also find
it helpful to read the Insolvency Service publication titled
'Dealing with Debt - How to
wind up a company that owes you money'
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|
Question |
I
have obtained my discharge, but am still unable to obtain credit,
as my name is included on a credit reference agency's records.
Will the Official Receiver arrange for the removal of the listing
as I now have my discharge? |
| Answer |
The Insolvency
Service has no regulatory responsibility for credit reference
agencies and cannot assist directly in the correction of
information held. If you have any questions about the operation of
the agency or its listing policy please contact that agency.
Although credit reference
agencies will update their records upon receipt of a certificate
of discharge, a bankruptcy order is kept on the credit
reference agencies' files for six years from the date the order
was made.
You may also
find it helpful to read the Insolvency Service publication titled
'When will my bankruptcy
end'
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|
Question |
How
do I make myself bankrupt? |
| Answer |
First, you will
need to complete the following forms, which you can print off from
our website at the following links:
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The petition, form 6.27 - this
form is your request to the court for you to be made bankrupt and
includes the reasons for your request.
http://www.insolvency.gov.uk/forms/ew/Form6-27.doc
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The statement of affairs, form
6.28 - this form shows all your assets (anything that belongs to
you that may be used to pay your debts) and all your debts. It
includes the names and addresses of the creditors and the amount
you owe each one. The form contains a Statement of Truth that you
will need to complete.
http://www.insolvency.gov.uk/forms/ew/form6-28.doc
You will also find
an example for completing form 6.27 at
http://www.insolvency.gov.uk/forms/ew/6-27%20example.doc and
Guidance Notes for completing form 6.28 at
http://www.insolvency.gov.uk/forms/ew/Form%206.28%20Guidance%20Notes%20-%20WORD.doc
If you cannot print
the forms off from our website you could get them from a legal
stationer.
You should complete
the petition and statement of affairs forms in capital letters,
using black ink.
Court staff can
only advise you on the court procedure. They cannot give you the
forms you need or provide legal advice.
If you are
dealing with a county court, the court will need the completed forms
and 2 copies of each. If you are taking your petition to the High
Court, you won't need any extra copies. When you have completed both
forms and have the fees ready, you can go to the court and ask for
your petition to be dealt with.
NB: If you are,
or were, running a business in partnership (even if there is no
formal partnership agreement) and all the partners want to be made
bankrupt, you will need different petition and statement of affairs
forms. These are available on our website at the following link:
http://www.insolvency.gov.uk/forms/IPOforms.htm
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|
Question |
How
do I make someone else bankrupt? |
| Answer |
Instruct
a solicitor, but be aware that this is likely to cost you £1500.
You may also find
it helpful to read the Insolvency Service publication titled
'Dealing with Debt - How to
make someone bankrupt'
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| Question |
Can
I have a bank account? |
| Answer |
There
is nothing in the insolvency legislation which prevents a bankrupt
from holding an account, but you should tell the bank or building
society that you are bankrupt, since they may wish to impose
conditions and limitations e.g. not allow a cheque guarantee card.
You should not obtain overdraft facilities without telling the
bank that you are bankrupt.
You may
also find it helpful to read the Insolvency Service publication What
will happen to my bank account?
Note: it is the
bank's decision as to whether to allow an account to be opened by
the bankrupt.
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| Question |
Can
a bankrupt still trade? |
| Answer |
If
you are bankrupt you are still allowed to earn a living, and can
do this by being self-employed or by carrying on a business, as
long as you do not disobey the law by obtaining credit of £500 or
more without disclosing that you are an undischarged bankrupt, and
as long as you do not use another name unless you tell those with
whom you trade of the name under which you were adjudged bankrupt.
If you earn more than sufficient to meet the reasonable domestic
needs of yourself and your family, the Official Receiver may apply
for an Income Payments Order (IPO).
You may also find
it helpful to read the Insolvency Service publications titled
'Guide to Bankruptcy' and 'IPO
/ IPA
(Income Payment Orders and Income Payment
Agreements)'
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| Question |
I
am an employee of an insolvent. Am I allowed to claim wages? |
| Answer |
The
Redundancy Fund may pay claims for unpaid wages, holiday pay and
wages in lieu of notice, up to certain prescribed limits, and
redundancy claims. The Official Receiver will provide copies of
the claim forms and an explanatory publication.
You may also find
it helpful to read the Insolvency Service publication titled
'A guide for employees'
Note: our Redundancy
Payments Directorate are responsible for processing and agreeing
the claims.
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| Question |
When
will I be discharged? |
| Answer |
If
the bankruptcy order was made on or after 1 April 2004 the
automatic discharge date is one year.
If the
bankruptcy order was made before 1 April 2004 different rules
apply, full details of which are set out in the publication 'Changes
to Bankruptcy Law under the Enterprise Act 2002'.
You may also
find it helpful to read the Insolvency Service publication titled
'When will my bankruptcy
end'
Note: Your discharge
may be suspended if you have failed to carry out your duties under
The Insolvency Act.
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| Question |
How
do I obtain a certificate of discharge? |
| Answer |
You
should write to the court where you were adjudged bankrupt quoting
your most recent case reference.
You may also find
it helpful to read the Insolvency Service publication titled
'When will my bankruptcy
end'
Note: the court fee
for a certificate of discharge is £60.
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| Question: |
How
do I apply for a job within The Insolvency Service? |
| Answer: |
Managers
within the The Service have responsibility for recruiting their
own administration staff and place advertisements initially in the
local job centre. Jobcentres can tell you of any current
advertisements.
Recruitment of trainee Examiners is
undertaken centrally. You can get details of current campaigns at
www.insolvency.gov.uk/recruitment.htm or contact Carolyn
Ramsay, Recruitment Coordinator on 01392 889674 email
Carolyn.Ramsay@insolvency.gsi.gov.uk
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| Question: |
If
I am made bankrupt, will I still have to repay my student loan? |
| Answer: |
Yes.
Since 1 September 2004 all outstanding student loans cannot be
claimed in bankruptcy. They remain the responsibility of the
(former) student to repay within the terms of the loan
arrangement.
If you were made bankrupt
before 1 September 2004 you may still have to repay your student
loan. Clarification should be requested from the Official Receiver
who is dealing with your affairs.
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| Question: |
What
is a centre of main interest? |
| Answer: |
Under the EC Regulation on Insolvency
Proceedings if you live in a member state, except Denmark, you can
only open insolvency proceedings (make yourself bankrupt) in the
country where you have your "centre of main interests".
There is no
definition of a centre of main interests but the Court will usually
regard the country where you carry on a business or earn your living
as your centre of main interest. The Court will also consider the
place where you normally live, i.e. your country of habitual
residence. If you are not employed or self-employed your centre of
main interests will be the country you normally live in at the date
of the petition.
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| Question:
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If my house is
sold sometime after the bankruptcy order is any shortfall on the
mortgage still a debt in my bankruptcy? |
| Answer:
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A debt which is secured by a
mortgage or a charge on a property is still a provable bankruptcy
debt. The mortgage loan company is "a secured creditor"
which means they have rights over an asset, the
house, and can require the asset to be sold to pay their debt. These
rights are not affected by the bankruptcy.
On the making of a bankruptcy
order the mortgage loan company could
make a claim in the proceedings but, unless it wished to give up the
security, could only claim for any (estimated) shortfall.
If you continue to live in the
property it is likely that you will continue to make payments to the
mortgage loan company to avoid the property being re-possessed. When
the property is eventually sold any
shortfall to the mortgage loan company is still a provable debt in
the bankruptcy, even if you have been discharged, as you are
released from the debt on discharge.
Your bankruptcy does not affect the obligations of any joint owner
who has not been made bankrupt to repay the mortgage loan debt or
any shortfall, as they are still liable for the whole of the debt.
After the date of the bankruptcy order the mortgage loan creditor
may ask you to sign a "deed of acknowledgment" of the
outstanding debt. If you have signed such a deed the mortgage loan
creditor can take action against
you to recover any shortfall following the sale of the property.
You may also find
it helpful to read the Insolvency Service publications titled
'What will happen to my
home'
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Question:
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I am based in
England and Wales and I am owed money by someone who is subject to
insolvency proceedings in another country, how can I let the person
dealing with the proceedings know about my claim? |
| Answer:
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If the
insolvency proceeding is in a country that is a member of the
European Union (except Denmark) then the person dealing with the
insolvency has to provide you with information about how, and when,
to submit a claim. When you make the claim, it can be made in
English (or Welsh), but must be headed with the phrase “Lodgement of
Claim” in one of the main languages used by the country in which the
proceeding is taking place. The Insolvency Service has prepared a
document with this phrase in all the official languages of the EU.
This can be
viewed HERE.
If the
insolvency proceeding is in a country that has put an international
agreement known as the UNCITRAL Model Law into law then the person
dealing with the insolvency has to provide you with information
about how, and when, to submit a claim. A list of the countries
that have put this agreement into law can be viewed at
http://www.uncitral.org/uncitral/en/uncitral_texts/insolvency/1997Model_status.html#$35287.
Other countries
may have laws dealing with the provision of information to people
who are owed money, and the submission of claims. It is not
possible to give detailed information here and, ultimately, it may
be necessary for you to obtain specialist assistance – perhaps, from
a lawyer in that country.
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Question: |
I do not live in England and Wales but in another country where I
have a lot of debts. Can I go bankrupt in England or Wales and
write off the debts in the country where I live? |
| Answer:
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If you are
living in a European Union Member State (except Denmark) a
bankruptcy order made in England and Wales will be accepted in all
EU countries. Before the Court will make a bankruptcy order you must
show that your "centre of main interests” is in the UK.
The court will
usually regard the country where you carry on a business or
otherwise earn your living as your centre of main interests. If you
are unemployed or self-employed your centre of main interests will
be the country you normally live in at the date of the petition.
Therefore, if
you live or work in the another country of the EU (apart from
Denmark) you cannot go bankrupt in England and Wales.
If you intend
to re-locate to the UK and establish your centre of main interests
here, to take
advantage of personal insolvency legislation, you should be aware
that the official receiver will investigate the truth of your move.
If your re-location is only temporary or false, for example if you
continue to work in the country where you formerly lived, the Court
can rescind (remove) the bankruptcy order.
If you live in
another part of the World (or Denmark) you can make yourself
bankrupt in England and Wales if:
(a) you are personally present in
England and Wales on the day you present your petition for
bankruptcy to the court, or
(b) if you have lived or carried
on business in England and Wales in the previous three years.
The country in which you live may
not recognise the bankruptcy proceedings and creditors may still be
able to take action against you in the country you live in. Those
countries that have put an international agreement known as the
UNCITRAL Model Law into law are more likely to recognise a
bankruptcy order made in England and Wales.
A list of the
countries that have put this agreement into law can be viewed
http://www.uncitral.org/uncitral/en/uncitral_texts/insolvency/1997Model_status.html#$35287.
Scotland and Northern Ireland
take into account similar requirements regarding residency and
employment as are taken into account in England and Wales. Further
information may be obtained from the Accountant in Bankruptcy for
Scotland
http://www.aib.gov.uk/ or Insolvency Service of Northern Ireland
http://www.detini.gov.uk/cgi-bin/get_builder_page?page=2423&site=8.
You may also find it helpful to
read the Insolvency Service publications titled
'Guide to Bankruptcy' and
'Dealing with debt - How to petition for your own bankruptcy'
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