Bancruptcy of individuals

Requesting bankruptcy

Cost

If the debtor’s assets are not expected to cover the costs of the bankruptcy proceedings, security for those costs must be provided. The security is used to cover expenses related to the administration of the bankruptcy estate, such as the liquidator’s fees.

280.000 ISK insurance fee for bankruptcy cost
20.000 ISK processing fee to the District Court

Applying to the Debtors Ombudsman

If you have been unsuccessfully seeking solutions to financial problems, you can, under certain conditions, receive

The aim is to enable a person who does not have assets and has no ability to pay, to file for bankruptcy.

Filing for bankruptcy with the District Court

The bankruptcy claim must be written.
The claim should be submitted to the district court where you have your legal domicile.

Bancrupcty claim

When a bankruptcy claim is submitted, certain information must be included in the claim.

The claim must state, among other things:

that you demand that your estate be taken into liquidation and the demand is based on Article 64. Act no. 21/1991 (in Icelandic)
your full name and national identification number
your legal domicile and place of residence, if it is different from your legal domicile
business information, if so:
1. A brief description of how the business is run
2. Where the business takes place
3. Whether it is a company with a separate name and identification number
clear description of the facts of the case and your arguments: how your finances have reached a point where you believe it is right to claim bankruptcy on your estate
detailed information about your assets and liabilities. It must be stated how much of the debt is overdue or in arrears
monthly income and expenses and how much is left each month to pay off debts

A claim for bankruptcy must be accompanied by documents that demonstrate that you cannot meet your creditors when the claims fall due.