Changes to Insolvency Order – Nov 2016
Published 4 Nov 2016
Following on from reforms implemented to the Insolvency (NI) Order on 1st April, further amendments have now been proposed. The Orders will, if approved, come into operation on 30 November 2016.
The proposed amendments concern two main areas; the level at which creditors can petition for an individual to be made bankrupt, and the level of debt and total assets which an individual can own to be eligible for a Debt Relief Order.
Below is a brief description of the areas:
1) Bankruptcy Level: The minimum debt or total debts due to a creditor before they can petition for bankruptcy of the debtor, is set to increase. The amount, currently set at £750, will rise to £5,000. The increase will come info effect to petitions presented on or after the day on which the Order comes into operation.
2) Debt Relief Level: The maximum amount of debt and total value of property which an individual may have in order to be eligible for a debt relief order, is set to increase. The debt amount will be raised from £15,000 to £20,000, and the total value of property will change from £300 to £1,000. Note that property excludes a debtor’s domestic vehicle up to a value of £1,000.
The amendments, like those passed in April, are essentially designed to improve the overall insolvency process.
These changes will have a direct and almost immediate effect on a number of clients. In the instance of bankruptcy petitions, clients may wish to issue statutory demands or petitions before the limit increases to £5,000 on 30 November.
The Insolvency team at MKB Law can provide further clarification and assistance with such matters. Please contact David McAlinden on: 028 9024 2450 or email: firstname.lastname@example.org