The following Property guidance note provides comprehensive and up to date legal information covering:
Bankruptcy is an insolvency process for individuals, which commences on the day the bankruptcy order is made.
Until 6 April 2016, unlike its corporate equivalent liquidation, only the court could make an individual bankrupt. However, on 6 April 2016, the new bankruptcy applications regime came into force replacing debtors' bankruptcy petitions (but not creditors' petitions), meaning that any individual who wishes to be made bankrupt must make a bankruptcy application which is determined by an adjudicator, and not by the court.
The making of a bankruptcy order—whether by the court or by the adjudicator—will free the debtor from the debts due to their creditors (and will prevent unsecured creditors from commencing, or continuing with, any legal process against the bankrupt or their property). In return, a trustee in bankruptcy (trustee) is appointed in order to divide certain assets of the debtor among the creditors (who have a valid and approved claim in the bankruptcy).
The main legislation relating to bankruptcy is to be found in sections 264 to 371 and Schedule 5 of the Insolvency Act 1986 (IA 1986), Part IX, and the Insolvency (England and Wales) Rules 2016 (IR 2016), SI 2016/1024.
As with liquidation, the effect of bankruptcy is to realise the assets of the bankrupt and distribute the proceeds in accordance with the
**Trials are provided to all LexisPSL and LexisLibrary content, excluding Practice Compliance, Practice Management and Risk and Compliance, subscription packages are tailored to your specific needs. To discuss trialling these LexisPSL services please email customer service via our online form. Free trials are only available to individuals based in the UK. We may terminate this trial at any time or decide not to give a trial, for any reason. Trial includes one question to LexisAsk during the length of the trial.
To view the latest version of this document and thousands of others like it, sign-in to LexisPSL or register for a free trial.
Existing user? Sign-in
Take a free trial
0330 161 1234
To view our latest legal guidance content,sign-in to Lexis®PSL or register for a free trial.