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Cost of Debtor Applications to Increase By 100%


The Scottish Government have laid before the Scottish Parliament The Bankruptcy Fee Etc (Scotland) Regulations 2012, proposing massive hikes to the cost of debtor applications for bankruptcy, from £100 to £200.

Fears of such fee hikes were highlighted previously by Carrington Dean's Alan McIntosh in an article in the Scottish Law Journal, the Firm.

The changes, which are not part of the current Bankruptcy Law Reforms, are being justified as part of the Scottish Government's move towards full cost recovery for the Accountant in Bankruptcy (AIB).

They are also being justified because of the 60% funding cuts the agency has suffered over the last two years and the declining number of bankruptcy awards: resulting in increased costs to the administration of each bankruptcy.

The Scottish Government have also defended the hikes by comparing costs of debtor applications in Scotland with those elsewhere in the UK, where the cost is £700.

This, however, does not address the fact that of the approximate 42% of sequestrations in Scotland which are Low Income Low Asset cases, the equivalent Debt Relief Order elsewhere cost only £90 to apply.

Other Increases will be to the AIB's supervison fee for Protected Trust Deeds which will rise from £250 per trust deed to £100 per year, meaning a 3 year trust deed will now cost £300 or £400 for a 4 year trust deed.

The fee changes will be implemented from the 1st of June 2012 and the 1st of July 2012, with the debtor application fee change taking effect from the 1st of June.

...And Jesus Wept.

Read Alan McIntosh's Blog on the fee changes

 Further fee changes are:



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