A simplified form of bankruptcy has been welcomed by personal insolvency
practitioners this week.
The move comes just under a year after it was reported by Accountancy Age
that IP’s were having to turn away people with lower levels of debt as the cut
in fees would mean they would have to advise at a loss
The Debt Relief Order, which came into effect earlier this week, will allow
consumers who have debts of less than £15,000 and no assets to apply for a
simplified bankruptcy via Citizens Advice Bureau and not the courts.
Mark Sands, personal insolvency director at KPMG said: ‘It is another tool in
the armoury of an IP to help a consumer. It allows the right person to be in the
right process’ said Sands.
‘I’ve already recommended someone to go on one and people are already queuing
up to get them’ he added.
However the DRO, is set to inflate insolvency statistics to record levels of
over 150,000 by the end of 2009 despite historically low base rates.
An enforcement restriction order is due to come out this time next year and
will allow those applying to seek court protection from their creditors for a
fixed period of time. It can only be applied for if there is a sudden change in
a person’s financial circumstances but they are likely to recover.
But insolvency trade body R3 cautioned the government to adopt stringent
approval standards for DROs in order to prevent their abuse.
Richard Le Tocq, head of Locate Guernsey, discusses the chancellor’s approach to high net worth individuals, and why relocation is increasingly attractive to HNWIs
The firm says that the U-turn 'does not alter the need for a fundamental review of the way we tax work' and that the current tax system is in need of reform
Legislation on the NICs changes to be brought forward in the autumn following publication of 'the full effects of the changes to Class 2 and Class 4' in the summer
Following chancellor Philip Hammond’s Spring Budget speech, we explore the key takeaways for businesses and individuals