Petition costs and OR fees in bankruptcy and compulsory liquidation to rise from 16th November 2015

Petition costs and OR fees in bankruptcy and compulsory liquidation to rise from 16th November 2015

The costs of presenting a bankruptcy or winding-up petition will increase for petitions presented on or after 16th November 2015.

When presenting a petition, the petitioner has to pay a deposit that will discharge a proportion of the administration fee charged by the Insolvency Service (OR fees) in every bankruptcy or compulsory liquidation. (This is on top of the relevant Court fees.)

The remaining balance of the OR fees is paid as an expense of the bankruptcy or liquidation. The petitioner will then, in turn, be reimbursed the amount of their deposit as an expense, if there are sufficient assets in the insolvent estate.

The new fee structure

Petition type Current
deposit 
Proposed
deposit amount 
Current total OR fees
(including deposit) 
Proposed total OR fees
(including deposit) 
Debtors (own)
bankruptcy
petition
£525 £525 (no change) £1850 £1850 (no change)
Creditors'
bankruptcy
petition 
£750 £825 £1850 £1990
Compulsory 
winding-up 
petition
£1250 £1350 £2400 £2520

What this means for you

You will need to consider these new changes before deciding on what action to take, as it will now cost more money to issue a petition.

If you’re issuing a bankruptcy or winding-up petition after 16/11/15, the petition will be rejected if the wrong fee amount is paid.

What do I think?

Coupled with the recent increase in the minimum bankruptcy threshold, these fee increases may make the insolvency route less attractive.

But all in all, I doubt the changes will have a great deal of effect. With the bankruptcy deposit and winding-up petition fees increasing by £75 and £100 respectively it’s unlikely a creditor, who will be owed at least £5,000, will be put off.

Need advice? Get in touch today

Please call Chris Adams on 01482 324252.

Or email cha@gosschalks.co.uk.

You can find out more about our Insolvency Law service here

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