How Do I Declare Bankruptcy?

Qualify to go bankrupt

First, you must qualify to go bankrupt. You must be “insolvent”. For a non-business person to be considered insolvent, you must owe at least $1,000, and your finances must fall under one of two definitions in the bankruptcy law.

  • The first definition requires that a calculation be done. In day-to-day English, it states: if your assets cannot be sold to recover sufficient proceeds to pay off your debts, you are insolvent.
  • The second definition is more general. It states that if you are unable to pay your debts, generally as they come due, you are insolvent.

Meet with Licensed Trustee

Secondly, you must meet with a Licensed Trustee in Insolvency (“Trustee”). The Trustee is a highly qualified professional, trained and licensed to help you. The Trustee will summarize your finances, including your assets, liabilities and current and expected future income. The Trustee will also discuss your options, including bankruptcy and other approaches to resolving your debt.

Once your questions and concerns have been fully answered you will be in a position to make an informed decision about going bankrupt.

Trustee will describe the bankruptcy process

If you decide to proceed, the Trustee will describe, in detail, the bankruptcy process as it will apply to you, including: the benefits of filing bankruptcy, the anticipated costs, the length of time you will likely be bankrupt, and the duties you must fulfill as a bankrupt. The Trustee will also explain its responsibilities to you.

Provide required documents to Trustee

Fourthly, you will be asked to provide documents to the Trustee to facilitate its preparation of a number of documents.

Signature of forms \ registration of the bankruptcy

Lastly, once you have provided the required documents to the Trustee, it will prepare a number of forms for you to review, swear are correct, and then sign. Once signed, the Trustee sends certain of the forms to the federal government Office of the Superintendent of Bankruptcy (“the OSB”).

The OSB promptly returns a certificate of appointment to the Trustee. It confirms that the bankruptcy was filed, accepted and that the process has begun. You are in bankruptcy, protected from your creditors and their threats and lawsuits. A new beginning!


Going bankrupt provides many significant benefits. Your finances, and health issues related to debt stress, will dramatically improve.

We hope this blog has introduced you to how to go bankrupt.

We would be pleased to answer any questions you may have.

Baker Tilly Ottawa Ltd.
David Brown, CPA, CA, Trustee in Insolvency and Proposal Administrator

Ottawa, Ontario