Claiming bankruptcy has finally entered the modern world

Victoria Jenner reports on the new phenomenon, edited by Victoria Jenner.

The recent changes in tax legislation, implemented from the start of this new tax year (which was the 6th April), is undeniably intimidating and equally mind boggling to the everyday person. Similar to stepping into a chapter of Dicken’s ‘Bleak House’, the financial world appears overbearing and masked with endless confusion, in the guise of PAYE and HMRC documents. However, when taking a microscope to the most recent legislative decisions made by the government, we can see a pattern: an attempt to transform negative connotations surrounding “Tax” and “Bankruptcy” into something positive for current and future generations. This seems like an automatic contradiction and yes, it must be: how can losing money be seen as a positive?

In my recent work experience in an accountancy office in Milton Keynes, having to “make contractors aware” of their loss of food and travel expenses if under an ‘umbrella contract’, I know from first-hand experience that the average working man is angry and frustrated. So how do we look through the initial resentment that seems to emanate as everyday life is liable to be taxed? We must weigh up what has recently been enforced and hope that the reasons behind governmental decisions are purely for ‘the greater good’.

Since three weeks ago, accountancy firms would have been updating due to a variety of changes effecting independent businesses and agencies. One of the most shocking changes made is the new service that allows bankruptcy applications to be made online. Speaking on the behalf of all twenty year old students, my mouth is hanging open at the abominably late response to our supposed ‘high-tech’ and considerably efficient First World country. The new service gives people seeking to make themselves bankrupt the ability to complete an online application via GOV.UK. This saves the need to make a personal bankruptcy application to court -known as a ‘debtor petition’- saving the applicant both time and money. The current application fee for a debtor petition is £180. The cost of an online application to the adjudicator is £130 and it is also possible to make the payments in instalments online using a debit card. There is no change for people and businesses owed money who are seeking to have someone declared bankrupt. They will continue to have to apply to a Court Registrar.

Insolvency Service chief executive Sarah Albon said: “Seeking help to deal with problem personal debt is the key step to being able to move forward. Online bankruptcy applications will be easier for people to complete and will remove the perceived stigma of going to court, which we know stops some people from applying.” Last year, almost 80,000 people used a debt solution for which official statistics are collected – this included 39,993 individual voluntary arrangements, 24,175 debt relief orders and 15,797 bankruptcy orders. The new online bankruptcy application has been developed by the Insolvency Service in conjunction with advice from former bankrupts, debt advice charities and other organisations to ensure it is easy to use. A new interactive smart answer tool has also been developed to help those in debt find the best debt solution for them.

Despite the bitterness and humiliation that comes with getting into debt, the fact that dealing with it in a more astute and efficient manner online- not only reflects HMRC’s progress into twenty-first century Britain but highlights an area for improvement. Old fashioned methodologies consisting of extensive paperwork is the reason that the world of finance appears convoluted and unapproachable. However, this new change demonstrates an avid step towards a more ‘modern’ and comprehensible way of confronting the issues of debt – a comforting idea for a future graduate facing the competitive world of work in 2017.