Comparison · Debt & Insolvency · 2026
Sequestration (Scotland) vs Bankruptcy (England & Wales) 2026: Which Insolvency Route Applies?
Scotland has its own personal insolvency law and its own administering body, separate from bankruptcy in England and Wales. Understanding which regime applies to you — and which route within it — matters because the fees, thresholds and process genuinely differ. This guide compares both for 2026.
TL;DR -- 30-Second Summary
- • Scotland: sequestration, administered by the Accountant in Bankruptcy (AiB)
- • England & Wales: bankruptcy, administered by the Insolvency Service via an Adjudicator
- • MAP is Scotland's low-cost route for low-asset, low-income, benefits cases
- • DRO is the nearest English/Welsh equivalent to MAP — a separate route, not bankruptcy itself
- • Which applies to you depends on where you are habitually resident, not where individual debts arose
Side-by-Side Comparison
| Feature | Sequestration (Scotland) | Bankruptcy (England & Wales) |
|---|---|---|
| Governing law | Scots insolvency law | Insolvency Act 1986 (England & Wales) |
| Administering body | Accountant in Bankruptcy (AiB) | Insolvency Service (via an Adjudicator) |
| Low-cost / low-asset route | Minimum Asset Process (MAP) | Debt Relief Order (DRO) — a separate process |
| Discharge from the debts | Typically automatic after 12 months | Typically automatic after 12 months |
| Post-discharge contributions | Debtor Contribution Order, where applicable | Income Payments Agreement/Order, where applicable |
| Public record | Register of Insolvencies (Scotland) | Individual Insolvency Register |
Worked Example: Two People With £15,000 of Debt, Both on a Qualifying Benefit
One person lives in Glasgow, the other in Manchester. Both owe around £15,000 in unsecured debt, have no significant assets, and receive a qualifying means-tested benefit. Their available low-cost routes differ because they fall under different insolvency systems.
| Measure | Glasgow resident | Manchester resident |
|---|---|---|
| Applicable regime | Scottish sequestration | Bankruptcy (England & Wales) or a DRO |
| Likely low-cost route | Minimum Asset Process, via the AiB | Debt Relief Order, via an authorised debt adviser |
| Who administers it | Accountant in Bankruptcy | Insolvency Service, via an approved intermediary |
| Application fee | Reduced fee under MAP | Fixed DRO fee, lower than standard bankruptcy |
Both routes are designed for people in a very similar position, but the legal name, administering body and specific qualifying conditions differ because Scotland runs its own insolvency system. Confirm current fees and eligibility with the AiB (Scotland) or an FCA-authorised debt adviser (England & Wales) before applying, as thresholds are reviewed periodically.
Which Route Applies to You
The starting question is not which debts you owe or to whom, but where you are habitually resident or have your main centre of interests — a Scottish resident normally goes through sequestration even if all their creditors are UK-wide lenders based in England, and vice versa. If you have recently moved between Scotland and the rest of the UK, get advice early, since the applicable regime can depend on residency in the period immediately before you apply.
Choosing the Low-Cost Route Within Each System
Within Scotland, MAP suits people with minimal assets and low income on a qualifying benefit; full sequestration is the route once you have assets to realise, higher debts, or do not meet the MAP criteria. Within England and Wales, a DRO suits people in a similarly constrained financial position with debts under the DRO ceiling; standard bankruptcy applies once you exceed the DRO limits or want to initiate the process directly through the Adjudicator rather than an approved intermediary.