Temporary exemption from bankruptcy application fee among measures in Coronavirus (Scotland) (No.2) Bill unanimously passed by MSPs

New emergency legislation also includes provisions that make it harder for creditors to make individuals bankrupt, and facilitate use of electronic processes to make bankruptcy easier to administer during pandemic

Bankruptcy fee exemptions will be temporarily extended under provisions in the Coronavirus (Scotland) (No.2) Bill, that was unanimously passed yesterday by MSPs.

The Bill - that supports new emergency measures to help people in Scotland get through the crisis caused by the coronavirus (COVID-19) outbreak - includes measures that will exempt individuals and sole traders from certain bankruptcy application fees that would otherwise be payable where their only income at the date of their application for sequestration is from specified benefits including universal credit, pension credit and child tax credit.

In addition, other debt-related measures in the Bill include -

• reducing bankruptcy application fees for those that are not exempt under the temporary easement of fees for those on benefits;
• provision to make it harder for creditors to make individuals (and sole traders) bankrupt -
  • by raising the maximum level of debt covered by the Minimal Asset Process from £17,000 to £25,000; and
  • by raising the minimum amount that must be owed to a creditor before that creditor can apply to the courts to make an individual bankrupt from £3,000 to £10,000;
• making bankruptcy processes easier to administer - particularly to facilitate the use of electronic communication and to permit virtual meetings of creditors. as a result of the impact of physical distancing.

Commenting on the passing of the Bill, that also includes measures relating to a broad range of policy areas including housing, social security and community care, Constitution Secretary Michael Russell said -

'Scotland remains in an unprecedented situation. This legislation provides time-limited measures that will further strengthen our ability to prioritise work tackling the coronavirus pandemic, and support those in Scotland facing real hardship as a result.

Whether it is taking action to safeguard the population’s health such as the measures relating to care homes, helping people in debt or students with accommodation costs,  we will continue to do all we can to help Scotland get through this most testing of times.

In a spirit of cooperation and consensus we have worked across parliament and with all parties as much as possible as we take these important steps to tackle the impact of this ongoing crisis.'

For more details see MSPs support further emergency coronavirus legislation from gov.scot

Stop press (28 May 2020) - the Coronavirus (Scotland) (No.2) Act 2020 has now been published.