How is Bankruptcy initiated ?
The process of bankruptcy may start in two ways. You can petition the court to declare you bankrupt when you find that all the financial options before you are closed. Alternatively, your creditors can take you to the court if you are unable to pay your dues. This is possible if you owe your creditor £750 or more and you are unable to pay back the amount.
There is yet another way you can be declared bankrupt. For example, the court starts proceedings on behest of the creditors and you refuse to cooperate with the court or abide by its orders, the court can declare you bankrupt.
Fees charged for bankruptcy case
There are certain fees that you may have to pay in connection with your bankruptcy case. These include:
The court fee:The court fee amounts to £120.The court may waive this fee in certain circumstances, for example, if you are on income support arrangement. You may seek the advice of the court staff if you are doubtful about your eligibility for this concession.
Bankruptcy case administration fee: This fee, amounting to £250, cannot be waived. It has to be paid in all bankruptcy cases.
Fee for swearing the statement: While there is no charge to swear the statement in the county courts, you may have to pay £7 in the High Court.
Fee for married couple or business partners: If you are a married couple or business partners and both of you apply for bankruptcy, each one of you will need to make separate payment as fee. The fee can be waived if you apply jointly for bankruptcy under the Insolvent Partnerships Order 1994 (Form 16).
You may pay the above fees in cash, through postal orders, a bank, or through a solicitor’s cheque. Personal cheques are not accepted. The fees should be paid to H M Paymaster General.
Where should you present a bankruptcy petition?
You or your creditors can present a bankruptcy petition either at the High Court in London or a county court near your residence. The petition can be presented even if you are not present in England or Wales. The only condition is that you should normally be staying in England or Wales.
Your phone book contains the address and telephone number of your local county court. You should look for civil county courts and not a magistrate’s court.
You may also check the court service website www.courtservice.gov.uk. The website contains the index of the county courts. You will need to contact the court in order to know if it can hear the bankruptcy cases.