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Bankruptcy is never an easy option, but for some people it’s the only way they can deal with their debts.
Latest government data shows that in July 2025, 10,515 individuals entered insolvency in England and Wales. This was similar to levels in June 2025 and July 2024.
If you’re considering declaring yourself bankrupt, make sure you give yourself a bit of time to come to terms with your financial position first – the realisation that things are not going to improve can be extremely difficult to adjust to.
It’s really important to deal with the emotions surrounding your debt: feelings of guilt, shame, and often overwhelming feelings of responsibility. If you’re struggling, please seek help to manage these feelings. There are many voluntary organisations that run helplines where you can talk in confidence (more about these later).
Here’s what you need to know about the process of declaring yourself bankrupt.
Find out all your options
Talk to one of the free advice services so that you are fully aware of the options that you may have. They will also give you all the information about bankruptcy that you may need.
You’ll need to write down all your debts and financial commitments before you speak to anyone, so you can be certain that you haven’t underestimated or overestimated the scale of your debt problem. You will need current bank and creditor statements to complete the forms to file for bankruptcy.
You do not have to disclose the fact you’re considering declaring yourself bankrupt to friends or family. Just think about who needs to know and why. Bear in mind that if you’re employed, your employer will be advised of changes in your tax coding because of your bankruptcy, so it’s worth checking your contract to see whether this could affect your employment.
Filing for bankruptcy
To apply to go bankrupt you need to complete an online application at GOV.UK. There’s a total fee of £680 to apply to go bankrupt and this is non-refundable unless you decide to cancel your application before submitting it.
You can pay the bankruptcy fee online when you fill in the form with a credit or debit card. If you pay online you can choose to pay in instalments to help spread the cost. Once you file for bankruptcy, all access to your accounts will be frozen with immediate effect. You won’t be able to access anything – cash, cheques or credit cards. Any late use of credit cards and overdrafts will have to be explained to the Official Receiver. This means that you should take out any money you need to cover living expenses before you submit your bankruptcy application.
Once you’ve submitted your application, the adjudicator has 28 days to decide either to make a bankruptcy order or reject your application. If they need more information about your case, they will get in touch with you. If they do need to contact you, this means they have 14 more days to come to a decision.
When the bankruptcy order is made, it’s at this point that you’re officially declared bankrupt and your money and property will come under the control of an official receiver. It is their role to collect and protect assets for creditors after you’ve been made bankrupt. It’s really important that you’re completely honest with your appointed official receiver. They are generally helpful but you should expect to provide them with all information and data they require and should respond quickly to their requests. That means setting aside time every day to deal with the incoming correspondence which you have to forward to the official receiver by post. This can actually help shorten the period you are in the state of being an undischarged bankrupt.
You can open a new basic bank account as soon as you have been declared bankrupt, provided you advise the bank. Several banks offer this service and will not offer any credit but will allow you to withdraw money from your account.
Bear in mind that if you open a new account before you’re declared bankrupt, the official receiver will freeze your new account as well. During the bankruptcy period and for a considerable time afterwards you may wish to work on a largely ‘cash only’ basis.
Learning to work without credit
Your bankruptcy will stay on your credit file for six years after the bankruptcy order is made, and you won’t be able to take out any kind of credit arrangement such as a mortgage or loan during this period. Although it might feel really difficult not relying on credit, it can be a really useful exercise for future budgeting.
If you’re refused a bank account after bankruptcy, you may want to consider using a prepaid debit card so you can make payments to other people.
With a prepaid card you’re limited to spending only the amount of money that you put on the card and can normally ‘top up’ the cards with cash at a Post Office or Paypoint machine. Before applying for a prepaid card, make sure you check whether there are any fees and how much they are, so you can go for the most cost-effective option.
A final thought…
Bankruptcy is tough-going, and shouldn’t be entered into lightly or without first seeking advice.
There are plenty of free sources of help available and many charities and organisations can help you negotiate debt repayment plans with your creditors on your behalf. These include:
- Citizens Advice – 0800 144 8848 (England) 0800 702 2020 (Wales)
- StepChange – 0800 138 1111.
- National Debtline – 0808 808 4000
- PayPlan – 0800 280 2816
Whatever happens, don’t suffer in silence, as struggling with debts on your own can take a real toll on your mental health. If you are finding it hard to cope, our article Are money worries affecting your mental health? explains where to go for help if you need someone to talk to.
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