From April 2016 you have to apply for bankruptcy online, see the new online bankruptcy application. So no more turning up at Court clutching the money in cash! Instead you can pay by debit and credit cards, including paying by installments. There is still a “pay in cash” option if you want.
The payment methods are all explained in the new online application. I’m going through it in detail here as you might like to understand how this will work but don’t yet want to start a bankruptcy application.
Start a bankruptcy application
The first step is to start a bankruptcy application if you haven’t already done this. If you and your partner are both going bankrupt, these are handled separately so you will each need to start a bankruptcy application.
You will then be emailed your bankruptcy application number and a link to sign into the bankruptcy application. On the first Application Overview page there is a green Make a Payment button, which takes you to this screen:
To make a payment by credit, debit or prepaid card you enter the amount. You can pay by installments, adding more money when you can afford it. The minimum payment allowed is £5.
Although the system will not stop you doing this, the application informs you that “You shouldn’t use your own credit card to pay for bankruptcy“. The credit card company could regard this as fraud – you took out money knowing you couldn’t repay it because you were going bankrupt.
As you can see from the above picture, you will be able to see how much you have paid and how much is left to pay. Until you have paid the full fees you won’t be able to submit your bankruptcy application.
Paying in cash
If you want to pay in cash, it has to be the whole amount – £680 – you can’t make cash payments in installments. To do this, you need to:
- select the ‘I can’t pay by card‘ link at the bottom of the page;
- you will then be given the payment details: the sort code and account number for the Insolvency Service account and your unique payment reference, which will begin with ADJ, see this screenshot;
- NB this payment reference is not the same as your bankruptcy application number;
- go to any branch of NatWest with the cash and these payment details. Ask for a receipt which shows the amount and the payment reference from the cashier as proof you have paid;
- cash payments will take two or three working days to show up in your bankruptcy application as being paid.
Someone else paying for you
Sometimes some or all of your bankruptcy fees will be paid by someone else, usually a relative or a charity that gives grants for bankruptcy fees.
If they want to pay in cash, you give the the cash payment details that you would have used (see above) including your ADJ payment reference and they can use these in any branch of RBS. This has to be for the whole £680 amount, not for just part of the fees. And make sure they keep the proof of payment!
If they want to pay online, they can pay all or part of the fees. You need to:
- select the ‘Have someone else make a payment on my behalf’ link at the bottom of the page;
- you will be told your payment reference – it will begin with ADJ. This will always be the same for you, so if your mother wants to pay £100 a month into your account for the next 6 months you don’t need to get a new reference each time;
- you will also be given the address of the third party payment page – send this and your payment reference to the person who will be paying.
If you have paid some or all of the bankruptcy fees but haven’t yet submitted your application, you will get a full refund if you select the ‘Discard application‘ link on the overview page. The refund can take up to three weeks to process. This isn’t going to be an easy way to get some cash back if you are a bit short.
After you have submitted the bankruptcy application, you can’t withdraw it and ask for a refund. If your bankruptcy application is rejected, which the Insolvency services describes as an “unlikely event“, you will receive a refund of £550 – that is the £680 fees less the application costs of £130.
Any refunds will go back to the card the money was paid from, or to you if the payment was in cash.
This article is kept updated. For example the note about not paying your bankruptcy fees with your own credit credit card has been added when the Insolvency Service decided this wasn’t OK, and payments in cash now need to be made at a NatWest branch not a RBS branch.