What is 'discharge from bankruptcy'?
It is an event that takes away the restrictions of bankruptcy and releases you from most of the debts you owed at the date the bankruptcy order was made.
You will normally get your discharge automatically, even if no payments have been made to your creditors, you are still making contributions under an income payments order/agreement or some of your assets have not yet been sold.
The Official Receiver can apply to court for a bankruptcy restrictions order, which will mean that you continue to be subject to restrictions after discharge for the period stated in that order. This will not affect the discharge of your debts.
Find out more by reading our publication, Bankruptcy Restrictions Orders (BRO).
When will I be discharged?
When you will be discharged depends on a number of factors including when you were made bankrupt and if you have been made an undischarged bankrupt within the last 15 years.
If you were made bankrupt on or after 27 March 2006
You will be automatically freed from bankruptcy (known as "discharged") after a maximum of 12 months. This period may be shorter if the Official Receiver concludes his enquiries into your affairs and files a notice in court.
If you were made bankrupt before 27 March 2006
If this is your first bankruptcy, you will be discharged automatically on 27 March 2007 or, if you currently expect your discharge date to be before 27 March 2007, you will receive your discharge on that earlier date.
If you have been an undischarged bankrupt at any time during the 15 years before the current bankruptcy (unless the previous bankruptcy has been annulled) you will be discharged automatically on 27 March 2011. Or you may ask the court for a discharge five years after the date of the bankruptcy order, but the court may refuse or delay your discharge, or grant it conditionally on terms requiring you to make some payments out of your income.
Cancelling your bankruptcy
You will also become free from bankruptcy immediately if the Court annuls (cancels) the bankruptcy order; this would normally happen when your debts and the fees and expenses of the bankruptcy proceedings have been paid in full or the bankruptcy order should not have been made. Access our guidance leaflet: Can a bankruptcy order be cancelled.
Arrest of discharge
On the other hand, if you have not carried out your duties under the bankruptcy proceedings, the Official Receiver may apply to the Court for your discharge to be postponed. If the court agrees, your bankruptcy will only end when the suspension has been lifted and the time remaining on your bankruptcy period has run. If your discharge has been suspended (stopped) prior to 27 March 2006, you should contact the Official Receiver for information about how and when you may be discharged from bankruptcy.
How do I get my discharge?
If you are discharged automatically, you do not have to do anything to get your discharge. If you wish, you can obtain a certificate of discharge. A certificate is not necessary in most cases, but if you need one you should write to the High Court. There is a £89 fee payable to the court for issuing a certificate of discharge.
Do not write sooner than two weeks before your discharge date. Give your name, address and court number (to be taken from the latest correspondence about your bankruptcy). The court may check with the Official Receiver that you are entitled to an automatic discharge. You should receive a certificate confirming your discharge within about four weeks.
If you write to the Official Receiver, he will provide a letter, at no charge, confirming your date of discharge. You can also ask for the Official Receiver to advertise your discharge, but you will have to pay the costs of this before it is done.
You will not get your discharge automatically if your discharge period has been suspended, for example because you have failed to co-operate with the Official Receiver or trustee.
There is no automatic right to receive early discharge from bankruptcy.
The Official Receiver will review your file three months after the report to your creditors has been issued. This report is issued within eight weeks of the bankruptcy order. If the Official Receiver considers that there are no, further, matters in your bankruptcy which require investigation he will begin the early discharge process.
If you do not co-operate with the Official Receiver and answer letters as quickly and fully as possible you are unlikely to obtain an early discharge.
If the Official Receiver decides that early discharge is appropriate he will write to all your creditors and your trustee (if an insolvency practitioner has been appointed) telling them he intends to file notice of early discharge. Your creditors have 28 days in which to lodge any objection to your early discharge. If any objections are received the process will be suspended while the Official Receiver considers if any objections received are valid. An objection which causes the Official Receiver to carry out further investigation of your affairs will stop the early discharge process.
Only if no objections are received, or once any objections have been resolved, will the Official Receiver send notice of early discharge to the court. You will be sent a copy of the notice stamped by the court notifying you of your date of discharge.
The process of early discharge is unlikely to be completed less than six months from the date of the bankruptcy order.
Discharge and your debts
It is on discharge that you will be released (freed) from most debts that you incurred before the bankruptcy order.
The debts you are not freed from include:
- any money owed under family court proceedings for example, for maintenance or CSA payments or arising from any personal injury claims against you, unless the court directs otherwise
- any court fines or debts arising from fraud or certain other crimes
- debts you incur after the bankruptcy order
- since 13 April 2005, all outstanding student loans. If you were made bankrupt before 13 April 2005 you may still have to repay your student loan - clarification should be requested from the Official Receiver
Discharge and your mortgage payments
Secured creditors (lenders who hold security such as a mortgage for the money owed) still have the right to enforce or recover their security if payments are not met.
Discharge and your assets
Any assets that the Official Receiver or the trustee held or claimed during your bankruptcy remain under the control of the Official Receiver or the trustee.
They are not returned to you on discharge. It may be some time after your discharge before all your assets are dealt with. If your home has not been dealt with in a certain period, usually three years from the date of the bankruptcy order, your interest in it may be returned to you.
Find out more by reading our guidance publication, What will happen to your home?
If you are making payments under an income payments order or agreement you must continue to make these payments even after the date of your discharge.
Please note that, when your trustee makes a payment to your creditors, he may place an advertisement about your bankruptcy in a newspaper asking creditors to submit their claims. If it takes your trustee a long time to deal with an asset, this advertisement may appear several years after the bankruptcy order.
Discharge and your business
After discharge you can carry on a business without the restrictions that applied during your bankruptcy.
You can act as a director of a limited company or be involved in its management (unless you are subject to a separate disqualification order/undertaking or bankruptcy restrictions order/undertaking).
You will be able to obtain credit without having to mention your bankruptcy (unless you are specifically asked to do so or you are subject to a bankruptcy restrictions order/undertaking) but you will want to ensure that you can repay it.
Your obligation to co-operate with the Official Receiver and trustee
You must continue to assist the Official Receiver and the trustee, for example by providing any information requested, even after your discharge. If you do not, you could be liable to contempt of court.
What will happen to public records of your bankruptcy?
Your bankruptcy will be recorded in a number of places.
The Insolvency Register is maintained by the Bankruptcy and Chancery Office at the High Court and contains records of all insolvencies in Northern Ireland for the last ten years.
Land Registry/Registry of Deeds
Bankruptcy petitions and orders are registered at the Registry of Deeds against your name and may be recorded against documents of title in the Land Registry. If your petition is dismissed or you are discharged from bankruptcy you can vacate your registration in the Registry of Deeds by completing Form 11 (for the petition) or form 13 (for the order) of the Registration of Deeds Regulations (Northern Ireland) 1997 and lodging at the Registry of Deeds. There will be a charge of £4.
If notice of the presentation of the petition or the bankruptcy order has been given to the Land Registry the Order of Annulment should include provision permitting cancellation of any entry in the Land Registry or notice of the petition or any bankruptcy inhibition against your title as the registered owner of the land. You should take a copy of the Order to the Land Registry to have the cancellation made.
Credit reference agencies
The Official Receiver does not send any form of notice to credit reference agencies. The agencies pick up information from other sources such as the Insolvency Register, advertisements of bankruptcies in newspapers, "The Belfast Gazette" and the "Belfast Telegraph", and the Enforcement of Judgements Office.
Find out more by reading our publication, When will my bankruptcy end?