The Insolvency Proceedings (Fees) (Amendment) Order 2024 (SI 2024/963) was laid before Parliament on 19 September 2024 and is due to implement a price hike for a range of insolvency based matters under the Insolvency Act 1986.

What is changing?

From 9 January 2025, the Official Receiver’s general fee will increase from £6,000 to £7,200, with further administrative fee increases for:

  • A debtor’s application for a bankruptcy order (set to rise to £2,390 from £1,990)

  • A creditor’s petition for a bankruptcy order (set to rise to £3,300 from £2,775)

  • A winding-up order (set to rise from £5,000 to £6,000)

  • A public interest winding-up order (set to rise to £13,500 from £7,500), which will also see an increase in the payable deposit (set to rise to £13,500 from £5,000)

Why are they changing?

According to the Order’s explanatory note, little to no impact on the private, voluntary or public sector is foreseen and therefore, a full impact assessment has not been completed in relation to this Order. Practically speaking however, we expect the impacts to include there being less debtor applications for bankruptcy, less creditor petitions and less winding-up orders being sought by creditors.

This is in contrast to the Order’s predecessor, the Insolvency Proceedings (Fees)(Amendment) Order 2022 (SI 2022/929), which justified an increase in fees on the basis that the official receiver’s costs were not being met during a significant dip in the number of insolvency cases.

Although since 2022, The Gazette has seen a steady increase in insolvency rates; raising questions as to the necessity of this increase in fees and whether this change might affect the number of insolvency cases going forward. We suspect it will.

The Future

Not all change is negative. It remains to be seen if the increased fees, in respect of bankruptcy applications in particular, will lead to debtors exploring alternative options such as Debt Relief Orders which are certainly on the rise.

A watch this space scenario but one to consider when looking at the commerciality of steps to be taken at the outset of an insolvency case.

Contact an Insolvency Solicitor

If your business is experiencing financial difficulties, it is important you seek advice from a solicitor on your next steps at the earliest opportunity. Farleys has a team of specialists on hand to assist. Call 0845 287 0939, get in touch by email, or use the online chat below.