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Personal insolvency
Insolvency occurs when you find yourself in a position that you are not able to pay your debts as they come due. Individuals experiencing financial difficulties have a few options available to them to help them deal with their situation.
![[icon] Further information.](./medicons/med_icon_furtherinfo.gif "[icon] Further information.")
Further information
I am in financial trouble... what are my options?
When you find yourself struggling to makes end meet, you need to take time to assess what you can do about it. Any financial difficulties you may be experiencing now are likely to get worse if left unattended. You need to take steps now to ensure that you give yourself every opportunity to avoid bankruptcy.
What is bankruptcy?
Bankruptcy is a way of dealing with debts you cannot pay. Becoming bankrupt is a very difficult decision and it should only be viewed as a last resort. While it offers relief from most of your debts, you will be subject to a number of restrictions and limitations.
Responsibilities and restrictions during bankruptcy
There are a number of restrictions and responsibilities placed on you once you are bankrupt.
What happens to my assets?
At the date of your bankruptcy your assets become the property of the Official Assignee.
What happens to my debts?
On the date of adjudication, most of your debts incurred prior to your bankruptcy will be provable debts. This means that your creditors can submit a claim in your bankruptcy for the amount owing. These debts are ‘frozen’ on the date you become bankrupt and your creditors can no longer pursue you for payment or add any further penalties to the amount owing.
How do I apply for bankruptcy?
Debtors that have decided to file for bankruptcy will be required to complete and submit a Statement of Affairs and application for bankruptcy to the Official Assignee.
What is the No Asset Procedure (NAP)?
The No Asset Procedure presents debtors experiencing financial difficulty and who meet certain criteria with an alternative to the standard form of bankruptcy.
How does bankruptcy affect a business & employees?
Read about the impact bankruptcy can have on a business and its employees if the owner goes bankrupt.
Personal guarantees
It is common practice for directors to guarantee the debts of their company when obtaining credit from suppliers. If you have guaranteed the debt of a company that has gone into liquidation, it is likely that the creditor will seek to recover what is owed from you.
When does bankruptcy end?
You are usually discharged from bankruptcy automatically after three years.
Can I file for bankruptcy or a NAP online?
A debtor can apply for bankruptcy or for admission to a No Asset Procedure or a Summary Instalment Order online using the Insolvency and Trustee Service website.