Declaring bankruptcy is about as simple as filling out a credit-card application form. The former might be more painful in the short term, but with the latter you know you won't have any debts hanging over your head after four years. A debt-ridden person with no realistic prospect of repaying their obligations simply has to file a petition with a sworn statement of financial affairs to the High Court. They have to muster $8,650 to start proceedings right away and a court fee of $1,045. Pay about $5,000 to a lawyer and the process is almost over. 'Those applying don't even need to turn up to court and face the embarrassment of their name being called. Lawyers can represent them,' says solicitor Paul Tse. The court assesses your claim and, if approved, distributes any remaining money and assets to creditors. You don't lose the shirt off your back. Your wardrobe - even if it's full of Manolo Blahnik shoes and Gucci suits - can be kept. So too can personal effects such as your mobile phone, CDs, books and tools of the trade. But you will have to hand over your car, Rolex, expensive jewellery, art and antiques. Home owners get a one-month stay of execution, but can apply for six months, before selling their asset. Tenants can continue to rent the same flat if the rent is considered reasonable compared with their income. You can also keep your job unless you're a solicitor, or in other selected professions. Each year, you have to fill in a statement of your income and outgoings, which the Official Receiver monitors. Any money earned above your expenditure goes to your creditors. School fees are exempt, so children at expensive international schools can continue classes. There are no express restrictions on lifestyle, so taxis and restaurants are not forbidden. Bankrupts cannot obtain credit over $100, use bank accounts - except a savings account to receive a salary - and overseas travel is not allowed without permission. You won't be able to win a Legco seat or other public office position, nor become a company director. Four years later, your debt slate is wiped clean and you can replace your well-worn wardrobe, on credit if you like. If you can get it.