Filing for Bankruptcy
1. How does a debtor become a bankrupt?
A Bankruptcy Application is filed in the High Court by either the debtor or a creditor. The debtor owes debts of at least $15,000 which he cannot repay. The High Court may then declare him a bankrupt at the court hearing.
2. Debtor’s own application for bankruptcy
The Official Assignee does not provide advice on the procedure for a debtor to file his own application for bankruptcy. Debtors may also wish to refer to the Supreme Court’s website https://www.judiciary.gov.sg for further details on bankruptcy proceedings.
Applying for one’s bankruptcy should not be viewed as an easy solution to one’s debts woes. Debtors should look for alternative solutions to settle their debts before considering applying for their own bankruptcy.
3. Creditor’s application for bankruptcy
Before filing a Bankruptcy Application, a creditor will issue a notice known as a Statutory Demand, demanding payment from a debtor. If the payment is not met within the deadline stipulated in the Statutory Demand, the creditor will file a Bankruptcy Application against the debtor in the High Court and a court hearing date for the case will be set. If payment is not made by the hearing date, the High Court may proceed to make a Bankruptcy Order and declare the debtor a bankrupt.
4. Are there other costs involved in filing a bankruptcy application?
Any creditor or debtor who wishes to file a Bankruptcy Application in the High Court must pay a deposit of $1,850 to the Official Assignee for the administration of the bankrupt’s estate. The creditor applying for the bankruptcy may recover this deposit if there are sufficient funds in the bankrupt’s estate. The deposit of $1,850 will not be refunded to a bankrupt who has applied for his own bankruptcy.
If the Bankruptcy Application is dismissed by the High Court or if it is withdrawn, the Official Assignee will retain $50 as preliminary administration costs under the Bankruptcy (Fees) Rules and refund $1,800 to the applicant who has filed the bankruptcy application.
With effect from 5 Mar 2018, all payments will be made electronically.