How to declare bankruptcy in Ontario Canada?

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Thinking about declaring bankruptcy in Ontario? Start by chatting with a Licensed Insolvency Trustee (LIT) for a free initial consultation. They’ll assess your finances—debts, income, expenses—to determine if bankruptcy or a consumer proposal suits you best. Stay organized with your documents to smooth the process.

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Question

How to declare bankruptcy in Ontario Canada? I’m interested in the process for declaring bankruptcy in Ontario. How do I start, and who can help?

From: Anonymous Question Location: Vancouver, British Columbia (BC)
Topic: personal bankruptcy

Debt Insiders Answer

If you’re thinking about declaring bankruptcy in Ontario, the first step is connecting with a Licensed Insolvency Trustee (LIT) for a free initial chat. During this meeting, they’ll take a good look at your financial world—your debts, income, expenses, and assets. This helps to figure out if bankruptcy is your best bet or if something like a consumer proposal might work better for you. Get your paperwork in order; you’ll need details about your debts, assets, income, and family situation to make the process smooth like butter. For step-by-step guidance on how to declare bankruptcy in Ontario, Canada, you might want to check out this handy resource. Once you’re ready to give it the green light, you’ll sign the necessary documents, including the ‘Assignment’ and ‘Statement of Affairs.’ These are then filed electronically with the Office of the Superintendent of Bankruptcy, giving you immediate protection from those pesky creditors and stopping any wage garnishments in their tracks.

From: Insider Scott

Office of the Superintendent of Bankruptcy (OSB) Answer

To declare bankruptcy in Ontario, Canada, you should follow these steps:

1. Contact a Licensed Insolvency Trustee (LIT): A Licensed Insolvency Trustee (as defined in the Bankruptcy and Insolvency Act, RSC 1985, c 11, section 2) is the only professional authorized to guide you through the bankruptcy process.

2. Assessment of Debt: The LIT will assess your financial situation, including your debts, income, and assets, to determine if bankruptcy is the best option for you.

3. Filing for Bankruptcy: If bankruptcy is appropriate, the LIT will help you complete the necessary documents and file them with the Office of the Superintendent of Bankruptcy (OSB) as per the Bankruptcy and Insolvency Act (RSC 1985, c 11, section 49).

4. Attend the Credit Counseling Sessions: After filing, you must attend two credit counseling sessions to help you manage your finances better in the future, as per regulations found in C.R.C., c. 368.

5. Compliance with Requirements: You will need to meet ongoing requirements, such as making payments if your income exceeds a certain threshold. This is detailed in the Bankruptcy and Insolvency Act and corresponding regulations (SOR/2007-256).

6. Discharge from Bankruptcy: Once you’ve completed the required steps and timelines, you can apply for discharge from bankruptcy, which releases you from the obligation to repay most debts.

Licensed Insolvency Trustees can be found through the Office of the Superintendent of Bankruptcy website or by searching for LITs in your local area.

From: OSB Helper

Related Questions

Here are the top 5 most frequently asked questions related to declaring bankruptcy in Ontario, along with brief answers:

1. What are the eligibility criteria for declaring personal bankruptcy in Ontario?

You must owe at least $1,000 in unsecured debt and be unable to meet your debt obligations as they come due[2][5].

2. How do I start the process of declaring bankruptcy in Ontario?

You need to contact a Licensed Insolvency Trustee for a free initial consultation to assess your financial situation and prepare the necessary paperwork[1][4][5].

3. What are the duties I must complete during the bankruptcy period in Ontario?

You must provide tax information, submit monthly pay stubs and proof of other income, attend two credit counselling sessions, make required contributions to your bankruptcy estate, surrender non-exempt assets, and complete any other duties requested by the trustee[1][2].

4. Can I file for bankruptcy online in Ontario?

While you can sign documents digitally and have a debt assessment via video-conferencing, only a Licensed Insolvency Trustee can file your bankruptcy with the Office of the Superintendent of Bankruptcy[2][4].

5. What assets are exempt from bankruptcy in Ontario?

Exempt assets include your primary residence (if equity is under $10,000), one vehicle worth less than $6,600, household furnishings and appliances up to $13,150, tools of the trade up to $11,300, necessary clothing and medical devices, certain life insurance, and savings in RRSPs, RRIFs, and SPSPs (excluding contributions from the last 12 months)[5].

If you have a question about debt see our debt questions or ask your own debt related question.

References

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