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How to apply for bankruptcy in Scotland

You cannot apply for bankruptcy in Scotland on your own. Here is how the application works, what it costs, what you need to show and what happens after you apply.

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To apply for bankruptcy in Scotland, you must first get advice from an approved money adviser or an insolvency practitioner. They check whether you qualify and send your application online to the Accountant in Bankruptcy (AiB), the part of the Scottish Government that decides bankruptcy applications. You cannot apply yourself. The fee is £150, which many people do not have to pay, and there is no fee for the Minimal Asset Process.

The legal name for bankruptcy in Scotland is sequestration. Our main guide to sequestration explains what it means for your home, your job and your debts. This page covers the application itself.

Can you apply for bankruptcy yourself?

No. Money advice is compulsory. The law says that before you apply, you must get advice from a money adviser about your financial circumstances, the effect bankruptcy would have and how to prepare the application.

You can get this from:

  • a free debt advice service, such as a Citizens Advice bureau, a money advice centre, StepChange or National Debtline. The Scottish Government helps to fund free advice, and our page on free debt advice in Scotland lists the numbers and opening hours
  • an insolvency practitioner, a licensed professional who deals with insolvency. mygov.scot says they may charge for their service, so check this when you contact them

An adviser should look at every option with you, not only bankruptcy. mygov.scot says you need to get advice first to check which solution is right for your situation.

Which type of bankruptcy can you apply for?

There are two routes, and a money adviser works out which one fits after a financial assessment.

Minimal Asset Process (MAP)Full administration
How much you oweNo more than £25,000, no minimumAt least £3,000, including interest
Your assetsNo land or property, total no more than £2,000, no single item over £1,000 (a needed car up to £3,000 is ignored)Any, but they may be sold
Your incomeNo money left over after essentials, or certain benefits for at least 6 monthsYou may pay a contribution for 48 months
Application feeNone£150, unless you qualify for a waiver
Previous bankruptcyNo MAP in the last 10 years, and no other bankruptcy in the last 5No bankruptcy in the last 5 years

For either route, you must have been habitually resident in Scotland, or had an established place of business here, at some time in the year before you apply. Our guide to the Minimal Asset Process covers MAP in more detail.

What do you need to show for full administration?

The Bankruptcy (Scotland) Act 2016 sets out the conditions. You must:

  • owe at least £3,000, including interest, on the day you apply
  • not have been made bankrupt in the last 5 years
  • have had advice from a money adviser
  • sign a statement of undertakings, which includes a promise to pay the trustee an amount worked out with the Common Financial Tool (the standard way of working out what you can afford in Scotland)

You must also show you are insolvent in one of three ways:

  1. You are ‘apparently insolvent’. This is a legal test. One way it is met is if a creditor has served a charge for payment (a formal demand from sheriff officers) and the time to pay has run out without payment.
  2. You have a certificate for sequestration. A money adviser grants this if you can show you are unable to pay your debts as they fall due. It is valid for 30 days.
  3. You granted a trust deed that did not become protected because your creditors objected or did not agree to it.

Signing a trust deed does not, on its own, count as apparent insolvency for your own application.

How much does it cost to apply?

The application fee for full administration is £150. You do not pay it if:

  • you get Universal Credit, jobseeker’s allowance, employment and support allowance, state pension credit, child tax credit or another income-related benefit
  • you get working tax credit with child tax credit or a disability element, and your gross annual income is £18,000 or less
  • you had help from the Scottish Welfare Fund in the 3 months before you apply
  • the Common Financial Tool shows you have no surplus income

There is no fee for MAP. AiB’s figures for April to June 2026 show that 662 of 705 bankruptcy applications (93.9%) paid no fee. Your adviser will tell you whether you need to pay.

A free advice service will not charge you for helping. If you use an insolvency practitioner, ask about their charges first.

Not sure bankruptcy is the right route? Tell us a little about your situation and a licensed insolvency practitioner firm will call you to go through every option, including ones that are not a trust deed.

Start your enquiry

May not be suitable in all circumstances. Fees apply. Your credit rating may be affected. Free, impartial advice is available from MoneyHelper and other services.

How does the application work, step by step?

  1. Think about a moratorium. If creditors are taking action, a moratorium can give you 6 months of protection from most enforcement while you get advice. You can apply yourself or through an adviser.
  2. Gather your information. Have details of your income, your outgoings, your debts and anything you own. AiB says you must tell your adviser and trustee about everything you own or have owned in the last 5 years, including anything given away or transferred. If you have something on hire purchase, check the agreement, as bankruptcy may affect it.
  3. Get advice. The adviser does a financial assessment, checks whether you qualify and explains your options. If you meet the test, they can grant a certificate for sequestration. A MAP application always needs one, and it is one of the ways to show insolvency for full administration.
  4. The application is sent. Your adviser completes the application with you and sends it online to AiB, with the fee if you have to pay one.
  5. AiB decides. mygov.scot says you usually get a decision within 8 working days, as long as AiB has all the information it needs.

What happens once you are made bankrupt?

A trustee is appointed to manage your bankruptcy. This is usually AiB. You must follow the bankruptcy rules and co-operate with the trustee, and mygov.scot warns that if you do not, your bankruptcy could last longer or you could break the law.

mygov.scot also says your bank may freeze your account when AiB approves your application, so you may not be able to withdraw money for a while, and some banks close the account. Ask your adviser how to plan for this. Our guide to how long sequestration lasts explains discharge and the parts that carry on afterwards.

Can a creditor make you bankrupt instead?

Yes. A creditor you owe at least £5,000 can petition the court for your sequestration. That is a different process from applying yourself. If you receive court papers about it, get advice straight away.

What are the alternatives to applying?

Bankruptcy has serious effects, so it is worth knowing every option before you apply:

  • The Debt Arrangement Scheme (DAS) lets you repay debts in full, with interest, fees and charges frozen, and there is no charge to set it up.
  • A protected trust deed can write off the remaining debts included in it if it completes, but it has fees and risks, and it goes on the Register of Insolvencies. See a trust deed or sequestration.
  • An informal debt management plan repays debts at a rate you can afford, without legal protection.

An adviser needs to look at your full situation. Our guide to choosing between the Scottish debt solutions sets out the factors that make a difference.

Official sources

Common questions

Can I declare myself bankrupt online in Scotland?

Not by yourself. The application is made online, but it has to go to the Accountant in Bankruptcy through an approved money adviser or an insolvency practitioner, after they have given you advice about your finances and what bankruptcy would mean. Free advice services can do this for you at no charge. An insolvency practitioner may charge for their service.

Do I have to pay the £150 bankruptcy fee?

Not always. You do not pay it if you get Universal Credit or certain other benefits, if you had help from the Scottish Welfare Fund in the 3 months before applying, or if the Common Financial Tool shows you have no surplus income. There is no fee at all for the Minimal Asset Process. Your adviser will tell you whether you need to pay.

How long does it take to go bankrupt in Scotland?

mygov.scot says you usually get a decision within 8 working days of the application reaching the Accountant in Bankruptcy, as long as it has all the information it needs. Getting advice and gathering your paperwork before that can take longer, so it helps to have details of your income, spending, debts and anything you own ready.

Can I apply for bankruptcy if I owe less than £3,000?

Not through full administration, which needs debts of at least £3,000 including interest. The Minimal Asset Process has no minimum debt, so it may be open to you if you also meet its rules on income, assets and property. Other options, such as the Debt Arrangement Scheme, have no minimum either. A money adviser can check what fits.

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