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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:  

  • 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 
  • 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: If my house is sold sometime after the bankruptcy order is any shortfall on the mortgage still a debt in my bankruptcy?
Answer:  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'

 

Question:

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: 

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: 

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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