How to defend your Bankruptcy in the UK
If a person wishes to make someone bankrupt in the UK they need to be owed the sum of £5,000 or more. This is in comparison to the sum being just £750 as of 2015.
The individual petitioning for your bankruptcy, referred to as a petitioning creditor, will then be required to personally serve a statutory demand and thereafter a bankruptcy petition.
The person defending bankruptcy will be given a court date endorsed on the bankruptcy petition allowing him to attend court to defend the bankruptcy proceedings. It is always beneficial to engage a specialist bankruptcy solicitor to defend any bankruptcy proceedings as technical defences are sometimes available to defend the petition. An expert bankruptcy solicitor can also try and negotiate the debt or ask for time to pay. A large number of petitions are issued by the HMRC who are sometimes reluctant to agree to time to pay proposals although they are more amenable to enter into such arrangements when dealing with specialist bankruptcy solicitors.
There are also various other defences to bankruptcy petitions including disputing the debt, or if the person having been served with a bankruptcy petition has a counter claim or cross claim against the petitioning creditor. These are matters which can and should be properly discussed with an expert bankruptcy solicitor in order to work out as to whether there are realistic prospects of successfully defending any bankruptcy petition or whether it is best to negotiate and pay off the petitioning creditor or enter into a time to pay proposal.
If a person served with a bankruptcy petition cannot afford to engage a solicitor or barrister to represent him or herself at court then they should at least obtain some legal advice in the form of a fixed fee to alert them to the dangers of bankruptcy and the steps that they should be taking to either defend the bankruptcy themselves and to appreciate the consequences of being declared bankrupt, which will also result in their bank accounts being frozen.
There is no substitute for taking expert bankruptcy legal advice as soon as possible to allow you to make well-informed decisions, including decisions as to whether the petition should be defended or whether or not payment should be offered and made and within which timescales.