Have you ever felt like a tightrope walker, precariously balancing over the chasm of debt? If so, then know this: You’re not alone. Many people in Nova Scotia have faced financial hardship and pondered about bankruptcy costs in Nova Scotia.

The mere thought can feel like a frigid Atlantic wave crashing against your sanity. Rest assured, there is no need to fear the process.

In this guide, we’ll demystify bankruptcy for you – from understanding mandatory payments to navigating surplus income calculations and even identifying non-exempt assets. We’ll delve into the role of licensed insolvency trustees and their fee structure too.

Look- walking the financial tightrope doesn’t have to end in a fall! I’m hoping that each word here hands you another tool for keeping your balance on your path towards being free of debt.

Understanding Bankruptcy Costs in Nova Scotia

Filing for bankruptcy isn’t a decision taken lightly, and the associated costs are part of this serious consideration. The bankruptcy cost can vary depending on several factors including your income and family size.

Breaking Down the Costs

The first thing you need to know is that there’s a base contribution involved when you file bankruptcy. In Canada, the base cost for filing bankruptcy as a first-timer is set at $1800.00.  We understand that you likely don’t have a large lump sum of money sitting around so we set up reasonable monthly instalments to pay this amount over the course of your bankruptcy. Depending on the circumstances, we typically set this up over any where from 9 to 18 months.

This fee covers administrative costs such as filing fees and mandatory counselling sessions required by law.

Understanding Mandatory Payments

Beyond the base contribution, additional payments may be necessary if your net income exceeds certain thresholds set by the federal government – these are known as surplus income payments.

If you’re dealing with debt but feel unsure about declaring bankruptcy because of its financial implications or special treatment requirements like surrendering non-exempt assets or losing tax refunds from prior years – don’t worry. You have other options like consumer proposals which we’ll discuss later on.

Surplus Income and Bankruptcy in Nova Scotia

If you’re considering filing for bankruptcy, understanding how surplus income impacts the process is essential. In simple terms, surplus income refers to any amount that exceeds the established income thresholds set by the federal government (which are called the “Superintendent’s Standards”).

Calculating Surplus Income

In a bankruptcy scenario, your net monthly earnings and family size play a critical role in determining what you are required to pay to your creditors on a monthly basis.  There are certain non-discretionary expenses that factor into this calculation as well. Fifty percent of amount left after deducting the Superintendents Standard and any allowable non-discretionary expenses is what the surplus income contribution is required to be.  The surplus income calculator on our website and help you understand the calculation.

If someone’s income exceeds the Superintendent’s Standards, in a first time bankruptcy the bankruptcy period is 21 months instead of 9 months.  In a second bankruptcy, the bankruptcy is 36 months in length instead of 24 months.

The calculation gets more complex if you are filing and your partner is not.  The trustee will explain how the calculation works in these cases.

If your income exceeds the Superintendent’s Standards, and you are distressed about the amount of the payment, don’t panic just yet. At Golding & Associates, we are well-versed in handling such matters and looking at alternatives such as a consumer proposal.

Role and Fees of Licensed Insolvency Trustees

A licensed insolvency trustee in Nova Scotia is your go-to professional when dealing with bankruptcy. They offer help, guidance, and make sure the legal process runs smoothly and is in compliance with Canadian bankruptcy laws.

The trustee will meet with you and assess your situation and explain all of your options.  If you decide to file a bankruptcy or a consumer proposal the trustee will prepare the legal documents and file them with the government.  A licensed insolvency trustee is the only professional who is able to file these documents.  

Another aspect of the trustee’s role is to ensure fair distribution of a bankrupt individual’s non-exempt assets among creditors.  

The trustee will communicate with your creditors.  You do have to deal with them.  

The trustee will also complete two credit counselling sessions with you.  They will help you with budgeting and also discuss future credit use and how to reestablish your credit.

The cost involved here isn’t arbitrary or sky-high as one might fear. It’s regulated by the federal government under the Bankruptcy & Insolvency Act. The fees are based on a tariff set under this act ensuring transparency and fairness.

Bankruptcy Exemptions and Non-Exempt Assets in Nova Scotia

If you’re declaring bankruptcy, understanding the distinction between exempt and non-exempt assets is crucial. Bankruptcy exemptions in Nova Scotia allow certain possessions to be kept safe during this process.

Protecting Your Assets

Your first step towards asset protection involves identifying which belongings fall under “non-exempt assets.” In most cases, equity in a home, RRSP contributions made during the past twelve months or specific investments might have to be surrendered as part of the legal proceedings.

Income tax refunds are also assets available to creditors. Any refunds for income earned before filing are considered non-exempt. That means your prior years’ tax refunds could end up being claimed by your trustee to distribute among creditors.

Caveat: Laws vary across jurisdictions; always consult a licensed insolvency trustee for personalized advice.

Alternatives to Bankruptcy in Nova Scotia

If you’re struggling with money troubles, bankruptcy might appear to be your only way out. But wait. There are alternatives that could help you manage your financial struggles.

Understanding Consumer Proposals

A consumer proposal is a legally binding process managed by a licensed insolvency trustee. It’s an arrangement made with your creditors to pay back a portion of what you owe over time.

The great thing about consumer proposals? You get to keep all your assets, unlike declaring bankruptcy where non-exempt assets can be seized. Also, it won’t affect future income or tax refunds as much as filing for bankruptcy would.

Other Debt Management Options

Besides consumer proposals, there are more ways to deal with debt loads without resorting to bankruptcy. These include credit counselling sessions and other specialized programs designed for different circumstances.

You don’t need special treatment; just the right knowledge and support can set you on the path towards becoming debt free. Remember: no matter how long bankrupt periods feel like they’ll last forever – they won’t.


Unraveling the mystery of bankruptcy costs in Nova Scotia, it’s clear that understanding is key. You now know what goes into these costs, and how mandatory payments factor in.

You’ve seen how surplus income can affect your bankruptcy process duration. We also looked at licensed insolvency trustees’ roles and fees – another crucial part of this puzzle.

We explored non-exempt assets, giving you a clearer picture of what could be lost during bankruptcy proceedings. And remember, alternatives like consumer proposals or other debt management options are there if you need them.

In the end, navigating financial hardship isn’t about losing balance on a tightrope; it’s about arming yourself with knowledge to find footing again!