As of 16 November 2015, the costs of presenting a bankruptcy or winding-up petition will increase in most cases. This increase will apply to petitions made on or after this date.
The changes are as follows:
|Petition type||Current deposit||New deposit amount
|Current total Official Receiver’s fees (including deposit)||New total Official Receiver’s fees (including deposit)|
|Debtors’ bankruptcy petition||£525||£525||£1,850||£1,850|
|Creditors’ bankruptcy petition||£750||£825||£1,850||£1,990|
|Compulsory winding up petition||£1,250||£1,350||£2,400||£2,520|
Whilst the increases are relatively small for both the deposit and Official Receiver’s fees (administration fees payable to affect the bankruptcy order or winding-up order), when considered alongside changes to statutory demands for individual debtors, the rises will make it more difficult for creditors seeking to recover money owed to them, especially from individual creditors.
A winding-up or bankruptcy petition cannot usually be presented to the court until the necessary deposit has been paid. This deposit is considered security for payment of the relevant fees. Where the assets recovered are enough to cover the cost of these fees, the deposit will be returned to the creditor making the petition. Unfortunately, where there are not sufficient assets to cover the fees or the costs of the insolvency practitioner appointed to handle the Debtor’s estate, the deposit will not be repaid.
Accordingly, there is always a risk that the fees paid by a Creditor to petition for bankruptcy or winding-up will not be recovered fully, if at all.
Further changes are likely to follow in 2016, as the Insolvency Service is currently undertaking a fundamental review of its funding regime.
Presenting a petition can be complicated, and most people choose to appoint a solicitor or insolvency professional to help them through this process.
If you require help with a winding-up or bankruptcy petition, please contact Linder Myers today.Contact us