What if your client goes bankrupt and your invoice is still unpaid?

Bankruptcy? You must file your claim through Regsol

When a client is declared bankrupt, a trustee takes over the management of the assets. From that moment on, your client can no longer make any payments themselves.
As a creditor, you must register your invoice as a claim through Regsol, the online platform of the Belgian Federal Public Service Justice.

How to file a claim in Regsol

• Go to www.regsol.be
• Create an account or log in as a company
• Search for your client’s bankruptcy file (using the company number or company name)
• Submit your claim before the stated deadline
• Attach supporting documents (invoice, purchase order, proof of delivery, communications, etc.)

If you do not submit your claim on time and correctly, you lose your chance of repayment. Even if you are 100% in the right.

What are your chances of getting paid?

That depends on what remains to be distributed in the bankruptcy. The following priority rules apply:

• The tax authorities, the bank, and the social security office are paid first, these are privileged creditors.
• Other privileged creditors, such as employees and pledge holders, also take priority.
• Ordinary creditors like you come last.

Unfortunately, this often means that, as an ordinary creditor, you recover little or nothing. But in some cases, when assets remain or if there’s a business restart, you may still receive a (partial) payment.

Did you include a retention of title clause?

Have you included a retention of title clause in your general terms and conditions? In that case, the goods you delivered legally remain your property until they are paid for.
Under certain conditions, you can reclaim these goods from the bankrupt estate, provided they are still identifiable and present.

These conditions are:

1. Agreed before delivery
   The retention of title must have been agreed upon in writing before delivery (e.g., in your general terms and conditions that were properly accepted by your client).

2. Clearly and correctly worded
   The clause must clearly state that ownership only transfers after full payment:

   “By way of derogation from Article 1583 of the Civil Code, the sold goods remain the property of the seller until the buyer has paid the total price.”

3. Goods still identifiable and present
   You can only reclaim goods that can be pointed out as your property:
   • They must still be present in your bankrupt client’s assets.
   • They must be individually identifiable (e.g., serial numbers, clear markings, or an invoice/delivery note matching the stock exactly).
4. Timely exercise of the right
   You must invoke the retention of title with the trustee and also mention it in your Regsol claim.
5. Respecting third-party rights
   Your right may be limited if third parties have since acquired stronger rights (e.g., a bank’s pledge on the inventory).

If the goods have been resold, processed, or are no longer identifiable, you can no longer reclaim them. In that case you remain an ordinary creditor.

What about VAT on an unpaid invoice?

When a client goes bankrupt and your invoice remains unpaid, you’ll want to reclaim the VAT you’ve already remitted to the tax authorities. In Belgium, this is not done through a credit note to the client. A credit note is only appropriate if something changes in the service or price, not when a receivable becomes uncollectible.

Once the bankruptcy is officially declared, your claim is considered uncollectible. You can then recover the VAT previously paid through a VAT adjustment in your tax return.

How to do this:

• Keep evidence: Make sure you can present the bankruptcy ruling or a certificate from the trustee.
• Do not send a credit note: The original invoice remains in your accounting records.
• Make an internal entry: Reverse the VAT via an internal adjustment and include the amount in box 61 of your VAT return (credit notes received/adjustments).
• Record the loss: The amount excluding VAT is recorded as an expense (“write-off of uncollectible receivables”).

Example
Your invoice was €1210 (including 21% VAT):

• Excl. VAT: €1000
• VAT: €210

In case of bankruptcy, you reclaim the €210 in box 61 of your VAT return. The €1,000 loss remains an expense in your income statement.

This way, you avoid paying VAT on income you never received without making legal errors like issuing an unjustified credit note.

Unpaid invoices? Don’t wait for bankruptcy

Although you can still take steps after bankruptcy, the chance of payment is very small. That’s why it’s crucial to act quickly when payments are overdue.

With Unpaid, you can recover undisputed B2B invoices quickly and legally through an accelerated procedure without court fees or subscriptions.