If you have decided that you want to make yourself bankrupt you must meet the following conditions:
You must owe a total debt of £1,500 or more; and
You must be living in Scotland or have lived in Scotland sometime during the last year; and
You must not have been made bankrupt in the last 5 years; and
You must pay the application fee of £100; and
You must meet one of the following conditions.
Conditions
Either:
One of your creditors is willing to agree to you making yourself bankrupt - this is called creditor concurrence. Your creditor has to sign a special form to confirm their agreement; or
You are apparently insolvent - apparent insolvency is a legal term that shows you cannot pay your debts as they become due. A creditor must have gone to court and obtained a ruling that you owe the debt to the creditor.
The most common types of evidence used to prove apparent insolvency are:
A Charge for Payment - this is a legal document with the words 'Charge for Payment' at the top. It means that you owe money to your creditor and that you should pay them within 14 days. If you do not pay within this period, the Charge for Payment expires and can then be used to prove apparent insolvency.
A Statutory Demand - this is a legal document with the words 'Statutory Demand' at the top. It gives you notice that your creditor may make you bankrupt if you do not pay what you owe them. A Statutory Demand expires after 21 days. If you do not pay within this period, the Statutory Demand can be used to prove apparent insolvency.
Both of these documents are normally delivered by a Messenger at Arms or a Sheriff Officer.
Or;
- You have low income and low assets (LILA) - this is a route into bankruptcy for people who cannot prove apparent insolvency or get creditor concurrence.
Low Income Low Assset route to bankruptcy
LILA is the route into bankruptcy for people who have low income and low assets.
Low income means gross weekly income of no more than the standard national minimum wage for a forty hour working week. This is equivalent to £229.20 a week. Any pensions or maintenance payments that you receive are also counted in with your income.
If you receive income support, income-based jobseekers' allowance or working tax credits you will be treated as meeting the low income test, even if your actual income is more than £229.20 a week.
When calculating your income no account will be taken of other social security benefits or tax credits you receive or any income paid to another member of your family. However, your income, pensions, maintenance payments, benefits, tax credits and the income of other family members may be taken into account when considering whether you should pay a contribution while you are bankrupt.
Low assets means that you have no single asset worth more than £1,000 and your total assets are not worth more than £10,000. In addition, it means that you must not own or jointly own a house or any other property or land.
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