Personal Insolvency and Bankruptcy in Cyprus

Three tools, one honest comparison

In short

The repayment plan restructures debts around what you can actually pay, through a licensed practitioner.
The debt relief order wipes qualifying debts for those with essentially nothing to restructure.
Bankruptcy is the backstop, and a creditor needs a debt of at least €15,000 to start it against you.

Kleanthous & Platis advises individuals facing debts they cannot service, guarantors who inherited someone else's collapse, and creditors deciding how to treat an insolvent debtor. The advice starts from arithmetic, not fear: what is owed, what can genuinely be paid, what the law protects, and which of the available tools fits those numbers.

The insolvency framework for individuals was rebuilt by the Insolvency of Natural Persons Law of 2015 and works alongside the older Bankruptcy Law. It has been amended repeatedly, most recently in 2026, which is one more reason the assessment is done on the current text and your specific numbers, not on what a neighbour was told years ago.

Start with the honest numbers

Send us a list of debts, income and assets, no polishing. We reply within one business day with which mechanisms your numbers realistically fit and what each would mean for your home. Email office@kleanthousplatis.com or call +357 22 680 330.

The repayment plan

Restructuring built around a viable debtor

For the person who can pay something, sensibly arranged.

The Personal Repayment Plan is a proposal to your creditors, prepared through a licensed insolvency practitioner, to repay or restructure debts over time. Eligibility is specific: habitual residence in Cyprus, actual insolvency, a reasonable prospect of becoming solvent within five years, and full, honest disclosure of your finances, and the courts have refused plans where the disclosure was not honest. The process can begin with a protective order that holds creditor action still while the proposal is prepared.

The plan binds once approved by the required creditor majorities, and dishonesty unravels everything. It is the tool for the debtor with income and something to protect, and its greatest practical strength is the next section.

The home

What the law does for the primary residence

Not an absolute shield, but a real one.

The law instructs the practitioner, where reasonably practicable, to formulate the plan so that the debtor is not required to sell or vacate the primary residence, after weighing the cost of keeping it, the household's finances, the contributions of those living there, and the family's reasonable housing needs against the cost of alternatives. The protection yields only where the debtor chooses to give up the home or where keeping it is so disproportionate that no viable plan can be written around it.

For the person whose overriding question is "do I lose the house", this is the honest answer: the repayment plan is the mechanism designed to avoid exactly that, where the numbers can carry it, and knowing whether yours can is the point of the first assessment.

The clean breaks

Debt relief orders, and bankruptcy without the mythology

One for those with nothing to restructure; one backstop for everything else.

The Debt Relief Order is the mechanism for the debtor with essentially no income and no assets: on the court's order, the qualifying debts, with their accumulated arrears, charges and interest, are discharged, and the process runs through the Insolvency Service with full disclosure and strict good faith. It exists because chasing a person who has nothing helps no one, including the creditors.

Bankruptcy remains the backstop. A creditor needs a debt of at least €15,000, liquidated and due, and an act of bankruptcy within the last six months, to petition against you, and a debtor's own petition must show that a repayment plan was genuinely attempted first; the court can even pause a creditor's petition to let a viable plan be proposed. Bankruptcy is not the end of the world, discharge and rehabilitation exist, but its consequences are broad, and the honest paragraph is this: it is sometimes the right answer, and the way to know is arithmetic, not dread.

The other side

Creditors facing an insolvent debtor

Realism, and the value of engaging with the plan.

For creditors, the framework is a discipline: an insolvent individual's estate rarely pays everyone, and the choice is usually between a repayment plan that yields something predictable and enforcement that yields costs. We advise creditors on voting in proposed plans, on when a bankruptcy petition is leverage and when it is throwing money after bad, and on guarantees, where the real recovery often lives. Guarantor questions have their own weight in Cyprus and are handled with the same arithmetic.

Common questions

Will I lose my house?

The repayment plan is designed, by statute, to avoid requiring the sale of the primary residence where that is reasonably practicable on your numbers. Whether your numbers carry it is exactly what the first assessment answers, and it is a calculation, not a guess.

What does a creditor need to bankrupt me?

A debt of at least €15,000, liquidated and due, an act of bankruptcy within the last six months, and your residence or business presence in Cyprus. Short of those, the threat is often louder than the reality, and even a filed petition can be paused for a viable repayment plan.

I guaranteed a relative's loan and the bank is now chasing me. Is this my insolvency or theirs?

Potentially yours, which is why guarantor exposure is treated as a first-class debt in the assessment, not a footnote. The mechanisms above can apply to guarantee debts too, and in some cases relief extends to guarantors. Bring the guarantee documents to the first meeting.

Is all of this public?

The processes involve registers and, for bankruptcy, publicity that the repayment mechanisms largely avoid. Discretion is one of the practical differences between the tools, and it belongs in the comparison.

Who leads this work

Between them the partners bring more than 40 years of practice in Cyprus. Every matter is run by one of them.

Andreas Kleanthous

Partner

Litigation, personal injury and insurance claims, debt recovery, administrative law, real estate, wills and probate.

Klitos Platis

Partner

Litigation, corporate and commercial matters, property and construction, including pleadings, interim applications and trial preparation.

Written on this subject

Directors' Duties When a Cyprus Company Is Insolvent

Corporate

Loan Restructuring in Cyprus: What Changes, and What It Costs

Banking

Δάνεισα Χρήματα σε Φίλο Χωρίς Χαρτί: Χάθηκαν;

Άρθρο

All our writing is on the writing index. Related: Restructuring & Insolvency, Litigation & Debt Recovery and Corporate & Commercial.

Before instructing, send us the invoice, contract or loan documents and a short history of the debt. Kleanthous & Platis LLC, Nicosia. Telephone +357 22 680 330, office@kleanthousplatis.com or klitos@kleanthousplatis.com.

Request a consultation

Tell us briefly how we may assist

A few sentences is enough: which property, what stage the transaction has reached, and any date that matters. We reply within one business day. Please do not send confidential documents until we confirm we can act.

Request a consultation

Or write to us directly at office@kleanthousplatis.com, or call +357 22 680 330.