Nick Griffin, chairman of the British National Party, has said his bankruptcy will not prevent him from "being or standing as an MEP".
He insisted he would continue as a member of the European Parliament and run for re-election in May.
"This order will not prevent me fighting for the interests of the British people or leading the British National Party to a fresh round of electoral victories. It's of no political significance whatsoever," he said in a statement on the BNP website.
The MEP revealed he had been declared bankrupt on Twitter - and said he would use the experience to produce a leaflet on how to deal with debt.
He tweeted: "A note for all: Being bankrupt does NOT prevent me being or standing as an MEP. It does free me from financial worries. A good day!
"Party funds are not affected in any way. Our campaign in May will be our most professional yet & I will be lead candidate in the North West.
"I am now turning the experience to the benefit of hard-up constituents by producing a booklet on dealing with debt. No surrender!"
A listing at the Insolvency Service showed he was declared bankrupt at Welshpool and Newtown County Court on Thursday.
He had offered to pay 42p in the pound over five years to all his creditors. This was rejected by the petitioning creditor.
The politician will be automatically discharged from bankruptcy in one year, on January 2, 2015, in accordance with the Insolvency Act.
He was elected to represent the North West region of England in 2009.
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