What is Bankruptcy?

Bankruptcy is a formal process legislated under the Bankruptcy and Insolvency Act and is filed by a licensed insolvency trustee.


  • Prevents creditor legal or collection action against you
  • Allows an honest, but unfortunate debtor, to get a fresh start
  • Discharges you from most of your debts


  • Assets may be affected
  • Payments are variable, based on income
  • Results in worst credit rating

May be the right option if you:

  • Cannot pay your bills
  • Do not have assets which would be at risk
  • Have low income and are unable to make a consumer proposal

Want to avoid filing bankruptcy?

If you need help dealing with your creditors, but don’t want to file personal bankruptcy we may be able to help you avoid bankruptcy by making a consumer proposal. 

Learn more about consumer proposals.

Cost to go bankrupt?

There is no set cost or fee for filing personal bankruptcy, though the typical minimum fee is $1,800 paid in nine monthly installments of $200 each. The maximum amount you pay is based upon your income and ability to pay. The surplus income formula used to calculate these payments is legislated under the Bankruptcy Insolvency Act and therefore the calculated payment amounts will be the same for all trustees. 

Learn more about how payments are calculated.

How long is the bankruptcy process?

The length of the bankruptcy process is legislated under the Bankruptcy and Insolvency Act, and is determined by two factors:

  1. Have you ever been bankrupt before?
  2. Do you have surplus income?

Based on your answers to these questions the length of your bankruptcy process would be as follows:

  • First time bankrupt without surplus income 9 months
  • First time bankrupt with surplus income 21 months
  • Second time bankrupt without surplus income 24 months
  • Second time bankrupt with surplus income 36 months
  • Third time or more bankrupt 36+ months as determined by the court

Learn more about bankruptcy

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