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Most debts written off
When you’re discharged, most of the debts included are written off.
Bankruptcy
A legal fresh start when nothing else will work. Most debts are written off, usually after 12 months.
Bankruptcy has serious consequences, including for your home. It costs £680 to apply and affects your credit rating. This page describes bankruptcy in England and Wales. Free, impartial debt advice is available from MoneyHelper.
Roughly how much do you owe?
Bankruptcy at a glance
- The application fee, paid to the Insolvency Service.
- £680
- Until you’re usually discharged, and most debts are written off.
- 12 months
- The longest you may pay towards your debts from your income.
- 3 years
- On your credit file, from the date of the order.
- 6 years
Figures from GOV.UK and the Insolvency Service.
Why people choose bankruptcy
Usually over in 12 months
Most people are discharged after a year, when most restrictions end.
Legal protection
Once the order is made, creditors can’t chase you or take court action over the debts.
Someone deals with your creditors
An official receiver runs your case and deals with your creditors and the paperwork.
A fresh start
It deals with debts you have no realistic way to repay, so you can rebuild.
Advice with no obligation
We’ll explain whether bankruptcy fits, and the alternatives, before you apply.
How bankruptcy works
Tell us about your debts
Answer a few questions. One of our advisers calls you, goes through your income and outgoings, and explains every option, not just this one.
You apply online
You apply to the Insolvency Service online and pay the £680 fee. An adviser can help you get it right.
The order is made
An official receiver takes on your case. Creditors can no longer chase you for the debts.
Discharge
Usually after 12 months you’re discharged, and most of the debts included are written off.
Weigh it up
Bankruptcy is the most serious route. Here is what helps, and the catch, side by side.
What helps
- Most debts written off
- Usually over in 12 months
- Creditors can’t chase you
- An official receiver deals with your creditors
- A clean slate to rebuild from
What to weigh up
- Your home and valuable things may be sold
- You may pay from your income for up to three years
- It stays on your credit file for six years
- Some jobs, and being a company director, are restricted
- It costs £680 to apply
Is bankruptcy right for you?
You’re likely a fit if…
- You can’t realistically repay your debts
- Other options, like an IVA or a DMP, won’t work
- You don’t own your home, or accept it may be sold
- You can pay the £680 fee, or save towards it
- You live in England or Wales
It may not be right if…
- You own a home or assets you want to keep
- You need to stay a company director
- Your job could be affected, such as some legal or finance roles
- You could afford a monthly payment towards your debts
- You live in Scotland
Other ways out of debt
Bankruptcy isn’t the only route. We’ll tell you which could work for you.
- InformalCan be used in England, Scotland, Wales
One affordable monthly payment, shared between your creditors.
- FormalCan be used in England, Wales
A legally binding agreement to pay what you can afford. The rest is written off.
- FormalCan be used in England, Wales
For a low income and few assets. Qualifying debts are written off.
Live in Scotland? Bankruptcy there is called sequestration, and works differently.
Questions about bankruptcy
Will I lose my home?
It’s possible. If you own your home and there’s equity in it, it may be sold to repay your creditors. Your adviser explains what would happen in your case before you apply.
How long does bankruptcy last?
Most people are discharged after 12 months, when most restrictions end and most debts are written off. Paying from your income can continue for up to three years.
Can I still work?
For most jobs, yes. Some roles, such as some in law and finance, have restrictions, and you can’t act as a company director without the court’s permission.
What debts aren’t included?
Student loans, court fines, child maintenance and debts from fraud. Secured debts, like mortgages, are dealt with separately.
How much does bankruptcy cost?
The application fee is £680, paid to the Insolvency Service. You can pay it in instalments before you apply.
Is there free help?
Yes. MoneyHelper offers free, impartial debt advice, and you don’t have to use a company like ours to get help with your debts.
You don’t have to sort this out alone
Tell us roughly what you owe and we’ll show you what could help. It takes two minutes, won’t affect your credit score, and there’s no obligation.
Roughly how much do you owe?