To initiate the procedure, must the following requirements:
- The person has been a taxpayer in the Republic of Latvia for the period of the last six months and has not been declared insolvent during the period of the previous ten years;
- Any signs of insolvency are observed regarding the person:
- The person is incapable of settling their debt liabilities that have reached maturity, and the total sum of debt liabilities exceeds EUR 5,000;
- Due to provable conditions (for instance, the person’s income is reduced, the work is lost, etc.), the person will be unable to meet their debt liabilities that will mature within one year, and the total sum of debt liabilities exceeds EUR 10,000.
How does the process occur?
The insolvency procedure of a natural person consists consecutively of the bankruptcy procedure and clearing of liabilities.
Thus, we receive the desired result – all liabilities are cleared. The regulatory enactments provide that not all penalties, for instance, criminal punishments and administrative fines, may be removed by initiating the insolvency procedure.
Within the framework of the procedure of clearing of liabilities, a fixed share of the debtor’s income is diverted for the satisfaction of creditors’ claims and, after the expiry of the period of the clearing of liabilities, the liabilities that have not been settled within this period shall be cleared.
All property of the debtor is sold within the bankruptcy procedure and the funds raised from the sales of property are diverted for the settling of creditors’ claims, except for the property that the debt recovery may not be directed against in accordance with the provisions of the Civil Procedure Law.
What has to be considered?
To initiate the procedure, must the following requirements:
- The person has been a taxpayer in the Republic of Latvia for the period of the last six months and has not been declared insolvent during the period of the last ten years
- Any signs of insolvency are observed regarding the person
- The person is incapable of settling their debt liabilities that have reached maturity, and the total sum of debt liabilities exceeds EUR 5,000
- Due to provable conditions (for instance, the income of the person is reduced, the work is lost, etc.), the person will be unable to meet their debt liabilities that will mature within one year, and the total sum of debt liabilities exceeds EUR 10,000.
How much does it cost?
- State duty – EUR 70.
- Administrator deposit – EUR 1000
- Drafting of documents – EUR 600 + VAT (the cost of the initial consultation amounting to EUR 100 is also included).
