Help with bankruptcy fees

If you have no money how can you afford £700 bankruptcy fees?A reader asked “I can’t afford to go bankrupt! Is there anyone else that can help with the fees apart from British Gas as I don’t have gas?”

The bankruptcy fees in England and Wales are £705 at the moment (£525 Official Receiver’s fee and £180 court fee) which is just stupidly high – most people go bankrupt because they are broke and they don’t have hundreds of pounds in their bank account. On Debt Camel’s bankruptcy information page, British Gas Trust is recommended as a charity that can sometimes help.  But what are your other options?

Help with the court fees

If you are getting means-tested benefits such as JSA, ESA or Pension Credit, you won’t have to pay the £180 court fee, see this information on whether you will qualify. You need to complete the application form at the end of that link and take it to the court when you bankrupt, togther with a recent benefits letter.

Sell stuff

If you have any valuable assets that you will lose when you go bankrupt, it makes sense to sell them beforehand to raise the money for the bankruptcy fees. Keep a record of what you sold and for what price.

(nb You need to be careful that you are selling them for a fair price if you are selling something to a relative or a friend. You can’t sell your two-year old Porsche to your brother for £1,000 – if you try this the Official Receiver will demand your brother returns the car – but if you use the Parkers valuation you will be fine. If you want to sell jewelry to a relative, get an independent valuation first etc.)

Help from charities

Many utility companies run trust funds that help customers with utility debts and other financial problems, including paying bankruptcy fees. Turn2Us has a lot of information on grant-giving charities. The following is a partial list: British Gas, EDF Energy, Thames Water,  NPower, United Utilities. Most of them prefer the application form to come from a Citizen’s Advice Bureau not you personally, as they need to know that you have had good debt advice that bankruptcy is a suitable option for you.

Some of them will only help with the Official Receiver’s fee, but you may not have to pay the Court Fee if you are on a low income, see above. Some of them have other requirements as well, eg they will not consider applications if you are a homeowner or if you have been bankrupt before. Your local CAB will be able to sort out which ones are appropriate for you.

There may be other charities that can help too. Sometimes these are local, sometimes you may be eligible because of your current or previous, for example SSAFA helps people who have served in the armed forces (including National Service) and their families. There are specific charities for people who have been civil servants, postmen, nurses, shop workers and many other groups.

Your local CAB is usually the best place to get advice and help with this, as they know of any schemes that only operate in you area.

Save it up!

The other alternative is of course to save up for the fees. If you are currently making payments to your non priority debts, including paying a DMP (or if you are struggling to pay into an IVA that you have decided to give up on), then you should stop, not even making token payments, and save this money up. When you get cross letters and calls from your creditors, tell them you are going to go bankrupt.

Stop paying council tax?

There has been a change in 2014 so the current year’s council tax will be included as a debt in bankruptcy. (NB don’t get  excited thinking how much more  money you will have when bankrupt as the Official Receiver will normally want you to pay the tax to him instead, see this article.) It is normally a very bad idea to not pay council tax as councils  take you to court and then you have bailiffs calling faster than any other creditor.  However, if you are literally  just about to go bankrupt and the money you would have paid to the Council this month will be enough to have the bankruptcy fee paid, then not paying this month would be a good idea. If you have never had council tax arrears before, you could consider missing two months payments.

Be very careful about doing this – if you change your mind about bankruptcy, or something crops up and you have to delay going bankrupt, then having council tax arrears is going to make your life more difficult.

Other Debt Camel information about bankruptcy
The big questions people have about bankruptcy

The big questions people have about bankruptcy

Should you tell creditors you are going bankrupt?

Should you tell creditors you are going bankrupt?

More articles about bankruptcy

More articles about bankruptcy

*** post updated on 28/04/14 when court fees for bankruptcy increased from £175 to £180
*** post updated on 29/08/14 to add suggestion to consider missing a month’s council tax

Comments

  1. I was on a debt management plan with Baines and Earnst for about 3 years and claimed a lot of PPI compensation to pay off some of my debt. unfortunately my work circumstances changed and lost my house. I now live in rented accommodation. I owe a substantial amount of money to the bank when the house was eventually sold, I then discussed my problem with B & E and they advised me bankruptcy was the best option for me I was advised to stop paying my creditors on the plan and inform them of my plans and I managed to pay the fees for their support to Baker Evans a subsidiary of Baines and Earnst, but I am struggling to find the £700 to start the process. Would it be possible to ask Baker Evans to fill in the necessary forms as proof I have taken good debt advice.
    Kind regards
    Carol O.

    • Debt Camel says:

      hi Carol,
      I am sorry to hear of your circumstances and also that Baker Evans have been profiting from your situation. You don’t actually have to produce written proof that you have taken good debt advice. The judge will usually ask you if you have , so just say Yes, I have been advised by Baker Evans”.
      Regarding the bankruptcy fees, I hope this post has given you some useful pointers. Your local Citizens Advice Bureau may also know of some local charities that could assist – it’s worth a try. Otherwise it is a question of putting £5 or £10 a week aside until they are saved up.
      (I have deleted your surname as i wasnt sure you would want your comment to be found by anyone that googled your name.)

  2. Hi. Its such a mess I had to leave family home due to domestic violence in which my husband refused to have anything in his name the debts are 25,000. And now I cant work due to disability. I’ve been awarded high rate for both mobility and care allowance and getting 71.40 per week ESA. Is there any help I can get to go bankrupt? Thank u

    • Debt Camel says:

      hi Paula, it sounds like bankruptcy is the best route for you and I would expect that you would be helped by one of the charities mentioned in this article. They prefer to receive applications through an approved debt advisor, so I suggest you go to your local CAB and ask them to help you apply.

  3. Hi,
    I have massive debt including a shortfall on my second/third mortgage of around 30,000 with also other debt. I got behind with council tax and they have been handed over to bailiffs – bristow and sutor, they did a walking possession and wrote my goods down and put me in an arrangment where i had to pay £30.00 per week. I have been doing this for over 12 months and never defaulted on this. I have since had a letter from them saying they had recieved another account so my arrangment has been deleted and they now wany 78.00 per week. I cannot afford this. I have enquired about bankruptcy but can i take the bailiffs into my bankruptcy. I work part time and recieve child tax and working tax credits i also get help from housing benefit. Any advise would be greatly appreciated and could i get help with the fees?? Thanks

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