A form of insolvency for Scottish residents, find out more information here

Sequestration is a debt solution available in Scotland that can help you write off debt that would otherwise take many years to clear. Sequestration is a form of insolvency and may be suitable if you can’t pay back your debts in a reasonable time. Sequestration is only available if you live in Scotland, if you live in England, Wales or Northern Ireland, bankruptcy is a similar solution, buts it’s important to note that it has different benefits, risks and fees associated with it. There are strict qualifying criteria you must meet in order to apply for Sequestration.

In order to qualify for Sequestration you’ll need to meet the following criteria;

  • Over £3000 debt outstanding.
  • Classed as apparently insolvent, which could mean a creditor has issued a statuary demand or charge for payment.
  • Must have obtained a certificate of sequestration.

Please find below an outline of the Risks/Disadvantages, costs and advantages of Sequestration:



Fees: You must pay the fees before you apply.

Bank Account: During sequestration, your current bank is very unlikely to allow you to keep your account if you have an overdraft or other debts with them. Even if you have no debts with them, most banks will close your account when you go become insolvent and it’s likely your account will be frozen for 2-7 days while the official receiver dealing with your sequestration checks your transaction history. You’ll normally have to open a new account with a different bank, and your choices may be limited.

Sequestration normally lasts for a year. During this time you can’t borrow any more credit and you must let the Accountant in Bankruptcy (AiB) know if your situation changes. They’re the governing body responsible for administering the process of personal bankruptcy in Scotland. You may have to sell valuable assets such as a vehicle, but you can keep the things you need for day-to-day living.

Restrictions: will last until you’re discharged, 12 months after you go into sequestration. If the official receiver finds that your insolvency happened because you acted irresponsibly or dishonestly, they can extend the length of time that restrictions apply. This is called a bankruptcy restriction undertaking or order, and can last up to 15 years. This might happen if, for example, you committed fraud, tried to hide assets, or ran up debts through gambling or similar.



It can be one of the quickest ways to give you a fresh start as you can be debt free in a short amount of time.

All your unsecured debts are usually written off, though you may be required to make a contribution.

You will receive no further contact from your creditors, as bankruptcy is legally binding.



It has serious implications for your future and holds various restrictions during the sequestration, such as:

You may find it difficult to take out credit, as sequestration will remain on your credit file for six years.

Your assets may be sold to release funds for the sequestration.

Some jobs may be affected, especially if you work in the legal or financial sectors.

You must cooperate with the official receiver. This includes handing over all documents and providing accurate information about your income, debts and assets.

Sequestration is not confidential and will appear on a publically-accessible register.

Breaking Restrictions: If your AiB suspects or finds you breaking these restrictions, they’ll investigate and may need to interview you, or get more information. If you don’t cooperate, they can also ask the court to suspend your discharge from bankruptcy.

Breaking these restrictions can be a criminal offence, and could lead to a fine or imprisonment in extreme cases. You could also get a bankruptcy restriction undertaking or order, which makes the restrictions last longer.

Assets: If you have any assets, like a house or car, these may be included in your bankruptcy.

Job: It may have implications for your job- for instance you will not be able to act as a company director.

Credit: You may find it difficult to take out credit, as sequestration will remain on your credit file for six years.