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  • FIRST POST
    • Kaleidoscope1972
    • By Kaleidoscope1972 18th Apr 17, 12:53 PM
    • 237Posts
    • 128Thanks
    Kaleidoscope1972
    HMRC enforcing Bankruptcy
    • #1
    • 18th Apr 17, 12:53 PM
    HMRC enforcing Bankruptcy 18th Apr 17 at 12:53 PM
    Hello
    Im posting this on behalf of a friend I have been supporting through a difficult time but would really appreciate any advice on his now impending Bankruptcy.
    My friend has ended up in a dire situation where he has lost his business and his home and is now living in his parents holiday home working in a low paid retail job and has a debt of 45k (with extra costs, the original debt was less ) to HMRC. The field force team visited him before Christmas and advised that there was no way they could recover the debt and they would enforce Bankruptcy, but advised it could be a long wait.
    The situation has been stressful and worrying for him and to make matters worse other business debts have come to light which he simply cannot pay and threatened with Bailiff action, he feels now is the time to apply for the Bankruptcy himself as he is up against a brick wall.
    my question is,First, whats the usual time frame from application to being declared bankrupt and also he is worried that his only possesion, his car will be taken away..its a 14 year old car worth roughly 12-1500 pounds if sold privately. When field force visited they suggested they may be not be interested in it as it would only fetch around 800 at auction.
    Also, hes worried he will be left with no money while his accounts are frozen, He has an account which his wages are paid into and is wondering if its frozen for a significant length of time?
    Ive been heping as much as I can, but having never gone through Bankruptcy myself, Im not sure what to advise him.

    Many thanks
Page 1
    • AnotherJoe
    • By AnotherJoe 18th Apr 17, 1:31 PM
    • 6,546 Posts
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    AnotherJoe
    • #2
    • 18th Apr 17, 1:31 PM
    • #2
    • 18th Apr 17, 1:31 PM
    Can his parents buy his car from him?
    • Kaleidoscope1972
    • By Kaleidoscope1972 18th Apr 17, 1:33 PM
    • 237 Posts
    • 128 Thanks
    Kaleidoscope1972
    • #3
    • 18th Apr 17, 1:33 PM
    • #3
    • 18th Apr 17, 1:33 PM
    I guess HMRC would want the proceeds then ?
  • National Debtline
    • #4
    • 18th Apr 17, 2:48 PM
    • #4
    • 18th Apr 17, 2:48 PM
    Hi Kaleidoscope


    I'm not sure it is worth their selling the car to their parents because of some perceived risk to the vehicle. A car of that value is by no means certain to be sold, and if having it enables your friend to earn a livelihood it may be disregarded altogether.


    If HMRC have threatened bankruptcy, it's not because they think that will magically recoup everything they are owed. It's more that they sometimes resort to it as a punitive measure when other strategies have failed.


    The car is no more or less at risk whether the bankruptcy is initiated by HMRC or by your friend.


    On a separate note, the "freezing" of his bank accounts is unlikely to last a significant period of time, and there are measures in place to help ensure he can continue to meet any living costs that crop up in the meantime.


    I'd recommend that he takes some independent advice on the whole process before he commits to anything. As helpful as you are being to him, it is important that he hears things directly from the horse's mouth.


    Dennis
    @natdebtline
    We work as money advisers for National Debtline and have specific permission from MSE to post to try to help those in debt. Read more information on National Debtline in MSE's Debt Problems: What to do and where to get help guide. If you find you're struggling with debt and need further help try our online advice tool My Money Steps
    • Pun
    • By Pun 18th Apr 17, 3:02 PM
    • 444 Posts
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    Pun
    • #5
    • 18th Apr 17, 3:02 PM
    • #5
    • 18th Apr 17, 3:02 PM
    Great that you're supporting him, but not sure you've looked at stuff which gives easy to follow and reasonably comprehensive guidance (e.g. it covers the car issue). Have a look at https://www.gov.uk/bankruptcy/overview

    Also worth his while making an appointment to see someone at his local CAB.
    • london1973
    • By london1973 18th Apr 17, 3:05 PM
    • 265 Posts
    • 63 Thanks
    london1973
    • #6
    • 18th Apr 17, 3:05 PM
    • #6
    • 18th Apr 17, 3:05 PM
    these are all legitimate concerns- from my experience being made BR by HMRC it should be about now the petition is served-I.e from the last field force visit-but this varies

    the bank account thing is everyone's worry but really needn't be, my account took about 2 months to be frozen, also on or around the bankruptcy date just open a basic account elsewhere and transfer everything over-Barclays with me-the banking aspect really is a breeze
    • Kaleidoscope1972
    • By Kaleidoscope1972 18th Apr 17, 3:44 PM
    • 237 Posts
    • 128 Thanks
    Kaleidoscope1972
    • #7
    • 18th Apr 17, 3:44 PM
    • #7
    • 18th Apr 17, 3:44 PM
    Thank you everyone.
    HMRC didnt threaten..rather said..we have no option but to enforce Bankruptcy..Ive been supporting more from a shoulder to cry on sense and directed him to National Business Debt Line back in November who also said sadly BR was his only option..debts are mounting 50 k and with no propertu..no savings and a minimum wage job earning 800 a month..he feels he has no choice but to push it through himself.
    Field force actually recommended it back in December ..so he shouldnt worry too much about the car I guess..and possibly look to open a Basic Barclays account ?
    • Kaleidoscope1972
    • By Kaleidoscope1972 18th Apr 17, 3:46 PM
    • 237 Posts
    • 128 Thanks
    Kaleidoscope1972
    • #8
    • 18th Apr 17, 3:46 PM
    • #8
    • 18th Apr 17, 3:46 PM
    Thank you Pun..hes looked on the GOV sight but I think its all just scrambled his brain..hes also seen someone from CAB last winter too
    • AnotherJoe
    • By AnotherJoe 18th Apr 17, 5:16 PM
    • 6,546 Posts
    • 6,975 Thanks
    AnotherJoe
    • #9
    • 18th Apr 17, 5:16 PM
    • #9
    • 18th Apr 17, 5:16 PM
    I guess HMRC would want the proceeds then ?
    Originally posted by Kaleidoscope1972
    He'd pay his rent with that surely?
    • Kaleidoscope1972
    • By Kaleidoscope1972 18th Apr 17, 7:03 PM
    • 237 Posts
    • 128 Thanks
    Kaleidoscope1972
    Well yes indeed
    • antonic
    • By antonic 18th Apr 17, 7:27 PM
    • 1,745 Posts
    • 2,576 Thanks
    antonic
    Has he been served with a Statutory Demand under S268 of The Insolvency Act 1986 yet ?.

    Until this has been served HMRC wont go to court to start the Bankruptcy proceedings.
    LBM Sept 2005 spoke to Payplan - brilliant !
    Dec 2005 debt £21.959.64 + HBOS Int £1769.32
    June 2013 debt £0.00
    DF status confirmed by email 10/07/13
    DFW Long Hauler 297
    • LincsPaul
    • By LincsPaul 20th Apr 17, 12:01 PM
    • 70 Posts
    • 24 Thanks
    LincsPaul
    Re. the car. Pretty sure he'd be able to keep it but, if not, he could say to the receivers that his parents will buy it AFTER bankruptcy for a fair market price so that he can keep using it. They don't have to say yes but they might realise more money than auctioning it to the public. That's assuming they are happy with him keeping a car in the first place.

    And sorry to jump in but if you go bankrupt and have a bit of money set aside for your next 2 months' rent, is it likely they will let you keep it? Could you pay the rent in advance to make sure it isn't lost?
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