How to File for Bankruptcy in Scotland

Bankruptcy may be an option if debt is becoming a serious problem.

Bankruptcy is known as sequestration in Scotland and the filing process is very similar to that in England and Wales. You must be "apparently insolvent" (i.e. unable to pay your debts) with total debt of £1,500 or more. Additionally, you must be living in Scotland or have lived in Scotland sometime during the last year, and have not already been made bankrupt in the last five years. Upon granting of sequestration by the court, your assets will be transferred to an appointed trustee who will try to sell them to raise the money needed to pay off your debts. During the sequestration period you will be financially restricted in many ways, for example you will not be able to apply for credit. You will be discharged after around three years from the date of the sequestration order.

Instructions

1. 

   A court ruling may have been made in respect to your inability to pay.

   Make sure you satisfy one of two conditions. Either one of the creditors you owe money to must provide their agreement, by signing a specific form, to you making yourself bankrupt, or else you need to demonstrate that you are unable to pay your debts as they fall due. Normally this requires certain steps having been taken by at least one of your creditors; they must have obtained a court ruling that you owe them money and subsequently served you with a Charge for Payment or a Statutory Demand for payment.

2. 

   The application must be completed in full.

   Obtain the correct information pack. There are three different packs depending on whether you are applying with the agreement of a creditor ("with concurrence"), without the agreement of a creditor ("without concurrence") or applying as an entity, such as a trust or a partnership, as opposed to an individual. The packs are available from money advisers and the Accountant in Bankruptcy. Make sure you follow the instructions provided with the pack and complete the application in full.

3. 

   There is a fee.

   Pay the application fee of £!00, which is payable under all circumstances with no exceptions.

4. 

   Written consent to act as your trustee must be obtained from an insolvency practitioner.

   Enclose written consent from an insolvency practitioner to act on your behalf, if you wish him to act as your trustee. If you do not do this, the Accountant in Bankruptcy will automatically be appointed as your trustee.

5. 

   Post your completed application to the Accountant in Bankruptcy.

   Send your completed application form with all required supporting documents and payment to the Accountant in Bankruptcy at 1 Pennyburn Road, Kilwinning, Ayrshire, Scotland KA13 6SA.

Tips & Warnings

• If you are unsure about any part of the legal process, instruct a suitably qualified professional, such as an insolvency practitioner, to act on your behalf. There are serious consequences to sequestration, and you should be fully aware of these before you take the step of filing for your own bankruptcy.

References

• Accountant in Bankruptcy: Apply

Resources

• Accountant in Bankruptcy