Creditor bankruptcy and liquidation petition deposits to rise
The up-front petition deposit fee paid by those initiating creditor bankruptcy and compulsory liquidation proceedings is rising from 1 November 2022.
The Insolvency Service is introducing changes to the deposits paid to initiate creditor bankruptcies and compulsory liquidations.
The petition deposit, the amount that needs to be paid up-front to seek an order, will be increasing in all cases where a petition is filed at court on or after 1 November 2022.
There will be no change to the adjudicator petition deposit where the individual applies for their own bankruptcy.
Changes being made to deposits
| Current Fee | Fee from 1 November 2022 | |
|---|---|---|
| Creditors’ bankruptcy petition deposit | £990 | £1,500 |
| Company liquidation petition deposit | £1,600 | £2,600 |
Each creditor bankruptcy or liquidation case administered by an Official Receiver is funded - in part - through a deposit paid by the petitioner to initiate the process.
The deposit contributes to the Official Receiver’s administration costs, with the remainder of their costs recovered through fees charged against assets realised during the bankruptcy or liquidation proceedings.
If there are sufficient assets to recover all the fees and costs, then the deposit is returned to the party who initiated the insolvency.
Fees have not changed since April 2016. Insolvency case numbers have fallen to a historically low level, and the majority of the remaining cases have insufficient asset values to recover the administration costs.
The deposit increase will enable the Insolvency Service to continue to administer and investigate insolvencies effectively, maximising outcomes for creditors whilst mitigating the risk of cost recovery being passed on to the taxpayer.
There will be no change to the adjudicator petition deposit where the individual applies for their own bankruptcy.
This change has been implemented through a change in legislation. The Insolvency Proceedings (Fees) (Amendment) Order 2022 was laid in parliament on 5 September 2022.
For further information on these changes please contact: [email protected].