Wylie & Bisset: Second emergency coronavirus bill will assist debtors facing financial hardship
Chartered accountants Wylie & Bisset have outlined how Scots facing financial hardship as a consequence of the coronavirus pandemic look set to benefit from the country’s second emergency coronavirus bill.
The Coronavirus (Scotland) (No.2) Bill seeks to raise the minimum debt threshold from £3000 to £10,000 while reducing the application fee in full administration bankruptcies from £200 to £150.
And the upper threshold for accessibility to minimal asset process (MAP) will be raised from £17,000 to £25,000 to help people in debt avoid a lengthy bankruptcy process.
Donald McKinnon, managing partner at Wylie & Bisset, said: “This bill will assist many Scots facing bankruptcy or financial uncertainty as a result of their workplaces being closed down due to COVID-19.
“There are essentially two types of personal sequestrations: one where a debtor applies themselves and one where a creditor applies to sequestrate a person. This bill seeks to increase the current £3000 threshold for a creditor application to £10,000.
“At the same time, the application fee for someone seeking to sequestrate themselves will be reduced from £200 to £150 – a measure to assist people entering the process, where before the cost may have been considered a barrier.
“It’s worth noting that, with creditor petitions set to move from £3000 to £10,000, this still does not prevent someone from applying for their own sequestration, as opposed to a creditor petitioning against them.
“Both measures can be seen as assisting individuals facing financial hardship as a consequence of the coronavirus pandemic by offering an element of protection from creditors, but also making it easier to action themselves.”
Emergency legislation intended to introduce temporary measures until 30th September, following which it will be subject to review and possible extension, the Coronavirus (Scotland) (No.2) Bill, which is likely to come into force by the end of the month, is designed to complement the measures already introduced in last month’s emergency coronavirus bill, which extended the personal moratorium to six months.
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