Insolvency in Self-Employment

Opportunity for a Fresh Start

A self-employed couple files for bankruptcy so that they can finally pay off their debts and make a fresh start.

Nils Eggers – Rechtsanwalt, Partner – BRRS Ribnitz-Damgarten

Insolvency Administrator

Nils Eggers

BRRS Office


Local Court



Standard Insolvency Proceedings

Key Facts

2 Self-employed persons with low income Debt volume: lower/middle five-digit range


Debt relief and new start



Initial Situation

A common type of insolvency. Nils Eggers becomes the insolvency administrator for a couple living on Hartz IV because their income from self-employment in the commercial sector is not adequate to pay off their debts and finance their daily lives independently.

The Insolvency Proceedings

Self-employed persons and private individuals cannot pay off debts if they are earning low incomes or even living and working at the subsistence level. In this case, the couple received commissions from commercial transactions. The income was not anywhere nearly adequate, especially since there were still three children to take care of. Hartz IV benefits were claimed to secure their livelihood. There were no reserves. People in these and similar situations can become insolvent for many reasons. They may be battered by fate in the form of illness, separation/divorce, loss of job, or payment defaults by customers or employers — and are then unable to service their loans, let alone pay off debts. Creditors in such cases are often banks, insurance companies, fiscal authorities, and internet and telephone service providers.

One way out of the debt trap may be the initiation of insolvency proceedings and the application for residual debt discharge. Profits from their self-employment were not expected in the insolvency proceedings. Nils Eggers declares the release of the self-employment earnings vis-à-vis the couple.

The Result

2020: Debt relief and new start

Further Reference Proceedings from Nils Eggers