Once you are adjudicated bankrupt you will furnish the Official Assignee with a Statement of Personal Interests.
This Statement will set out your income and your outgoings.
The Official Assignee has regard to the guidelines on Reasonable Living Expenditure needs as published by the Insolvency Service of Ireland. If your income is more than these guidelines the Official Assignee will ask you to agree to make payments to him for 3 years. The amount of this monthly payment will be the difference between your earnings and the guidelines.
If your income is at or below the guidelines no payments to the Official Assignee are required.
It is also possible to buy out the payments. So, for example, if the Official Assignee decided that you could afford €100 per month the full payment over 3 years would be €3600. The Official Assignee will agree to a discount on the €3600 if it is paid up front.
The benefit to having no payments or to buying out the payment is that you are no longer under review by the Official Assignee once you are discharged from bankruptcy. If you are making payments and your circumstances changes for the better, you are required to tell the Official Assignee. He can then require you to increase those payments during the remaining period.
There are two key costs associated with filing for bankruptcy in Ireland.
The Fixed Cost of Bankruptcy in Ireland
The fixed costs of bankruptcy are less than €500. This covers the costs of the Court papers necessary to apply for bankruptcy in Ireland.
Personal Insolvency Practitioner (PIP)
It’s always advisable that advice be taken from a solicitor or other professional in advance of seeking adjudication.
As part of the bankruptcy process you are required to meet a Personal Insolvency Practitioner (PIP) who has to analyse your financial circumstances and determine whether a Personal Insolvency Arrangement or Debt Settlement Arrangement is more appropriate. If the Personal Insolvency Practitioner determines that bankruptcy is the best solution he or she will be required to provide written evidence of this to the Court.
The application is made to the High Court and engaging the services of solicitor or counsel to deal with this will have added costs.
Where you have a pension, it is always appropriate that advice be taken as to the possible effect of bankruptcy on those assets.
A Personal Insolvency Practitioner may charge for this service.
So, the costs will depend, in the main, on the advisors you choose to engage.
It should be noted, however, that there are some charities who offer these services at reduced or zero rates.
For more information on bankruptcy in Ireland please click here.