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going backwards
Junior Member
172 Posts |
 Posted - 24 March 2008 : 20:30:54
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Hi there,
I am currently a director of a few limited companies and have gone personal guarantee for some of the borrowing. If I go bankrupt what will happen to these monies, I am not liable for them unless the business can't pay them(which it can at the moment). Does personal bankruptcy restrict my ability to be a director in the future?
My income is not currently shown as a salary, does this have any effect on any bankruptcy dealings either way, whether I show little income or a lot. I suppose I can generate money from the business in other ways, e.g expenses instead of wages. |
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JulianDonnelly
Junior Member
United Kingdom
325 Posts |
Posted - 24 March 2008 : 20:50:54
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Hi Going Backwards,
Welcome to the forum,
Alarm Bells are ringing with regard to your post and your position as a company Director.
Are you a shareholder in these companies?
If you are then the shares are an asset which will form part of your Bankruptcy and the shares you own will become the property of the trustee in Bankruptcy to sell for the benefit of the creditors.
You will not be able to be a Director of a company as one of the restrictions of an undischarged Bankrupt whether formally appointed or not.
If you remain in the company in an employed position this carries with it the considerable risk of being labeled as a shadow Director which is a criminal offence.
I think you need to seek professional advice before you decide on going down this road as there maybe more suitable solutions to your personal debt problems without affecting your position as a company director.
Julian Donnelly
Spokesperson for www.Bankruptcyhelp.org.uk |
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going backwards
Junior Member
172 Posts |
Posted - 24 March 2008 : 20:57:59
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Julian,
Yes I am also a major shareholder in some. Not that the companies would be worth much to sell my shares but I am sure it would get really complicated anyway. My other option seems to be an IVA where I am told that any business dealings etc are not affected(is this correct), one question though. As the business banks with HSBC would they find out that I have gone into an IVA( i dont personaly bank with them but arent they all linked somehow) and also would it be a good idea to close all my bank accounts that I have with joint people? Thanks |
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Reviva UK
Advanced Member
United Kingdom
2452 Posts |
Posted - 24 March 2008 : 21:01:09
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Hello goingbackwards
as Julian has said we would need a considerable amount of information before we could fully recommend a solution - expecially Br.
Information such as level of Debt, other assets like house, cars, shares, savings endowments etc etc are really important and would help us get a real understanding of your position.
Br is only 1 solution to debt, there are many others and you would be well advised to review each solution and see if it is viable and workable for your situation.
Paul Johns
Assisted Bankruptcy Specialists
Reviva UK
www.revivauk.com |
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melanie_giles
Senior Member
1191 Posts |
Posted - 24 March 2008 : 21:03:39
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The debts you have guaranteed will only be called upon if the company is also in financial difficulties - and you have confirmed that this is not the case, so hopefully this will not become a problem.
With regard to your income, I am assuming that you are in fact a sharehoder and receive dividend income instead of PAYE. There is nothing to stop you continuing to act as a shareholder of a limited company during bankruptcy, but as Julian has highlighted if the shares have any value they will form part of the bankruptcy estate and be realised if they have any value. A formal valuation of the company will therefore need to be carried out, and the shareholders agreement examined to see if there are any arrangements for the transfer of sharedholdings in such circumstances - where it is usual for these to be offered firstly to existing shareholders.
If you decide to remain as an employee, you will not be permitted to be involved in the promotion or management of the company during the period of your bankruptcy without the Trustee's permission - but to refer to this as a criminal offence is a little dramatic. In reality, most people are permitted to continue earning a reasonable living, but your activites will be closely monitored by the Trustee.
I would suggest that bankruptcy is the least favourable option for someone in your positioon, and if you have disposable income or assets which could be realised for the benefit of creditors perhaps an IVA or a DMP might be a better option in the long run. |
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JulianDonnelly
Junior Member
United Kingdom
325 Posts |
Posted - 24 March 2008 : 21:13:03
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Hi Going Backwards,
may i suggest you talk to Melanie or one of the other experts regarding your situation, as you have some complex issues to deal with.
As Melanie has suggested an IVA or a debt management plan may be the ideal for your situation, as this would not effect your position as a Director.
Julian Donnelly
Spokesperson for www.Bankruptcyhelp.org.uk |
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Helpful Advice
Average Member
United Kingdom
646 Posts |
Posted - 24 March 2008 : 21:24:39
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I support what the other experts have said, I don't think Bankruptcy is the best course of action for your situation and would advice you down the IVA route, due to your being a director of numerous LTD companies and BR would effect this position.
Kind Regards,
Brett England
Bankruptcy Specialist
England,Jackman & Spacey
WebSite www.ejands.co.uk
View my story at:
http://www.bankruptcyhelp.org.uk/forum/topic.asp?TOPIC_ID=594
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going backwards
Junior Member
172 Posts |
Posted - 24 March 2008 : 21:38:12
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Thank you all for responding. It seems everyone is in agreement. Unless my directorship and status with my companies change I will pursue the IVA and DMP for a better solution.
Thanks again. |
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Reviva UK
Advanced Member
United Kingdom
2452 Posts |
Posted - 24 March 2008 : 23:26:08
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Just a thought
as melanie has already a flavour of the challenges I would suggest you call her for an informal chat and see how the land lies.
The sister site - iva.co.uk - has some great posts you may wish to view, and you will be inspired by the comments from folks that have used Melanie for their solutions.
take care
Paul Johns
Assisted Bankruptcy Specialists
Reviva UK
www.revivauk.com |
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Topic |
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What about my business debt
