There have been recent changes to the Bankruptcy (Sequestration) rules in Scotland. Whilst the subject of Bankruptcy / Sequestration is still complex and needs careful consideration and GOOD advice we have detailed below the key points to assist you.

We strongly advise that you speak with one of our Insolvency Advisers BEFORE entering into the insolvency process as the consequences may be quite far reaching, especially if you own your own home, are in self employed or business in any way or have divorced and signed over the matrimonial home.

Key Facts:     

• For personal applications for bankruptcy i.e. people wishing to declare themselves bankrupt, the application no longer goes through the courts but is instead submitted to the Accountant in Bankruptcy.
  
  
• You must owe a minimum of £1500.00 before you can declare yourself Bankrupt.
  
  
• In most circumstances you may have to satisfy certain criteria (called Apparent Insolvency) before you can declare yourself Bankrupt  Call us for advice on this matter.
  
  
• If a creditor wishes to make you bankrupt they must lodge a petition at the appropriate Sheriff Court.
  
  
• A creditor wishing to make you bankrupt must show that you owe at least £3000.00
  
  
• For people on a low or no income level and who have no property or assets, a new scheme has been developed. Debtors on benefits or national minimum wage may declare themselves bankrupt without having to prove what is known as “Apparent Insolvency”. Call us for details.
  
  
• Persons are discharged from Bankruptcy after ONE year.
  
  
• Persons in employment can expect to be subject to a payment order if they can afford it. Contributions will commence from the date of agreement or order and last for three years
  
  
• Where a payment order has been made by the AIB or agreed with a Trustee the payment order itself will last for THREE years, even although the actual bankruptcy lasts for ONE YEAR! Call us for details.
  
  
• Student loans will NOT be written off under a Bankruptcy.
  
  
• Failure to co-operate: Restrictions may be imposed on debtors who fail to co-operate fully with their Trustee or who breach the rules of their bankruptcy. The restrictions may extend after the normal discharge period of one year for between two and FIFTEEN years.

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