Government moves to close bankruptcy repayment loophole

The Insolvency Service complained to the Department of Justice about an aspect of the legislation ‘being abused by practitioners and debtors’ to delay payments to creditors

Helen McEntee, Minister for Justice: amending the bankruptcy legislation to halt the use of ‘delaying tactics’ in bankruptcy cases. Picture: Sam Boal/

The government is closing a legal loophole to stop anyone declared bankrupt avoiding making repayments on their debts.

Bankrupts have to pay off some of their debts if they are found to have enough income to do so while also maintaining a reasonable standard of living. But some were deliberately delaying the setting up of their bankruptcy payment order by holding back financial information and mounting repeated legal challenges.

They did this in the knowledge ...