A person is bankrupt when they are unable to pay their debts when they fall due and payable.

There are statutory processes for making a person bankrupt, alternatively the person can voluntarily become bankrupt.

In some circumstances a debtor may voluntarily become bankrupt by filing a debtor’s petition.

It is important to note that becoming bankrupt will have serious consequences for a person’s credit rating and the ability to obtain a loan in the future and to be a company officeholder.