Bankruptcy Canada: People often ask “How bankruptcies work in Canada?” or “What is the bankruptcy process in Canada?” If it is determined that a Debt Consolidation Loan is not possible, and an Informal Arrangement or Consumer Proposal cannot be made, the most responsible action to take is declaring Bankruptcy in Canada. The first step is the initial Assessment which determined the need for bankruptcy.

What is bankruptcy?

Bankruptcy is a legal proceeding that individuals or companies undergo when they cannot repay their debts to creditors. If you want to learn more about how bankruptcies work in Canada, you can try reading the Bankruptcy and Insolvency Act Canada. This is a written law that directs all bankruptcy processes, commercial and consumer proposals as well as receiverships. The Office of the Superintendent of Bankruptcy Canada is also governed by this statute.

This first step is critical in determining that this is the only viable alternative. The moment the papers are signed, you are immediately relieved from having to deal directly with your creditors. Every phone call or correspondence is referred to a bankruptcy office. No one can sue you or garnish your wages. If this is your first time filing bankruptcy in Canada, the entire process takes nine months.

Watch our Video on the bankruptcy process

Let's Talk About The Bankruptcy Process In Ontario


How much does it cost to file bankruptcy in Canada?

The cost varies depending on your family size, assets, income and expenses. All necessary fees are regulated by the government. A licensed insolvency trustee will walk you through the considerations to have a trouble-free payment.

How to file bankruptcy in Canada?

It is relatively simple. Look for a licensed insolvency trustee to help you understand your situation and explain debt regulations. Your trustee will give details and advice on what is best for you so that you can weigh your options thoroughly. In case a decision is made, you will be provided with forms for the declaration of bankruptcy. The trustee will file the paperwork with the government and then you can complete the bankruptcy duties.

During this time a number of “Duties” are performed by the bankrupt and at the end of this process, you are “Discharged” with your debts cancelled.

These “Duties” include:

  • Telling the trustee (Richard Killen & Associates Ltd.) what your assets are and how much money you owe and to whom
  • Reporting every asset you disposed of in the past year
  • Disclosing everything worth $500 or more that you gave away in the past 5 years if you were insolvent at the time you gave it away
  • Providing the trustee with all required books, records or documents
  • Giving the trustee all your credit cards, even if there is nothing owing to them
  • Placing all your assets in the control of the trustee making any “Surplus Income Payments” during the bankruptcy
  • Attending all meetings and examinations as required and answering all questions truthfully, including 2 counselling sessions provided by the trustee
  • Co-operating with the trustee and communicating any changes as it relates to home address, employment, income and expenses.

For more information on the bankruptcy process in Canada, please contact our office. They can help you can get back in rebuilding your financial goals.

If you are not sure how to claim bankruptcies in Canada, would like more information on how bankruptcies work in Canada and to have a profound understanding of bankruptcy Canada rules according to the law, it is best to talk to a  licensed insolvency trustee.


Contact Richard Killen
FREE No Commitment Consultation

Contact us now for a fresh start!

“Serving Toronto & the GTA for over 25 years.”



    cup half full book

    question and answer

    Recent Blog Posts

    About Richard Killen & Associates

    Since 1992, Richard Killen & Associates, a Licensed Insolvency Trustee, have helped thousands of people resolve their financial problems. With 25 years experience in this industry, our president, Richard Killen, and the rest of our team understand the difficulties that honest people can sometimes find themselves in. This expertise makes it possible to provide you with a service that effectively deals with the issues.

    Contact us now for a fresh start!

    "Serving the GTA for 25 years."