The proceedings are simple enough when a living person owes you money.
But what happens when a deceased person or a bankrupt company no longer in existence owes you a debt?
If you are in a similar situation, keep on reading because this guide will cover all you need to know about this complicated situation and answer some FAQs as well.
What is Proving?
Proving is the process of demonstrating that a certain company or a certain person owes you a debt.
In case of a dispute, the creditor has to produce proof of debts for all the debts owed to him.
I’ve explained ahead exactly what is proof of debt along with the proof of debt form template.
Why is the Proof Required?
Sometimes your credit card isn’t enough to pay your dues. A proof is required when a company that files an insolvency form and is bankrupt owes you some money. In such a situation you have to contact an insolvency practitioner or an office holder in an insolvency service.
There are currently 1735 people in the UK working as an insolvency practitioner. This number is divided into people who work with government services and others who act as a trustee in dealing with creditors who are owed some money by a bankrupt company.
Insolvency means that an entity has outstanding payables that outweigh its assets. Government services or a practitioner should be contacted if someone is dealing with the dues of an insolvent deceased person. Usually, their national insurance can be used to pay off their dues.
What is the Proof of Debt Form?
It is an application that must be filed when an insolvent estate owes you some money. You must prove that you are in fact a creditor and you should be included in a meeting of creditors.
Authentication of Proofs
The proof must be authenticated by a person authorised by the creditor or the creditor himself. Under the Insolvency Rules 2010, you can also submit the form electronically via your email address or some other means. This is especially useful in COVID-19 circumstances.
The number of proofs for one debt cannot exceed one. This situation might arise when a creditor sells his debt to someone else and files a proof himself too. Unfortunately, the original lender will not have his credit card filled with cash.
Proofs that are not filed before the time specified are late proofs and they are not considered for the creditors meeting. It is advised to do your website work beforehand as servers can crash at the most unfortunate times leaving your work undone.
Amendment of Proofs
In case the information on a proof is to be amended, an agreement should be reached with the trustee managing the details of the issue.
Any number of proofs containing defective information must be sent back to the creditors to be amended and are reconsidered when the details have been amended and the information is accurate.
What are the Contents of the Form?
- Firstly creditor details such as contact information and email address are filled.
- Then there are some preliminary questions regarding your claim. This is like a multiple choice questionnaire in which you have to tick boxes that apply to your specific case. The boxes ask extensive questions.
- Then comes the quantity of your claim. You write the number that is owed to you and this part also seeks a statement regarding your potential claim.
- There’s also a further information section. If you are a creditor, you must provide the information that is required in this section.
This information includes the particulars about how and when the loan was incurred.
- Lastly the signature is required.
There’s a deadline for submitting your claim if you want to participate in an initial meeting where all the creditors meet and decide the fate of how the target company’s assets are to be divided. The asset can even be in the form of national insurance or fixed assets such as buildings.
There is also an option of an electronic submission which is probably the best option considering covid 19 circumstances.
How to Fill the Proof of Debt Form Correctly?
It is advised that you consult your lawyer regarding this or if you hired an insolvency practitioner, you should definitely consult with him/her and explain your dues in detail. Also ask for help while filling the form and naming the number which is owed.
If you are filling the form on your own make sure you are familiar with technical jargon like policy support links and Chattel leasing. Other than that, make sure you aren’t filling the form hastily and have a good 1 or 2 hours on your hand so you make no mistakes.
If you want to submit the form electronically, make sure you have a stable internet connection and do anything you can to make the particular website work in time, otherwise you may miss out on the initial meeting of creditors.
FAQs – All Your Queries Regarding Answered!
Who Requires a Proof of Debt?
The trustee managing the assets requires the proof. You must submit the form at the Special Administrators’ Office on the last business day before the initial meeting.
Who is a Creditor?
A creditor is someone who lends money to another person or company.
Who Do I Owe Money To?
You owe money to your lenders and must pay back that money in full with interest and potential additional fees.
Here’s a complete guide to learn who exactly you owe money to.
What Happens if I Don’t Pay My Debt?
If you don’t pay your dues, you can be taken to court for it. The court can potentially order that your assets be seized and sold to pay your dues in full. If your assets aren’t enough, that’s where this article will come in handy.
Is There a Feedback Form For How the Meeting Goes?
No, unfortunately there is no feedback form for the meeting.
The meeting is supervised by a licensed practitioner or someone the company has appointed. You must make all your claims in the meeting so that you don’t miss out on even a single penny that is owed to you.
At a first glance it looks like a very difficult process to take back something which the debtor doesn’t even own anymore, but once you get on with it, you’ll find out that it isn’t that difficult, just make sure to complete the process in time.
I hope this article helped you. If you need more help, you can reach out anytime through the email address provided.