LTD Company; personal bankruptcy?

edited 30 November -1 at 1:00AM in Bankruptcy & Living With It
7 replies 820 views
BankruptskiBankruptski Forumite
7 Posts
edited 30 November -1 at 1:00AM in Bankruptcy & Living With It
Me and my spouse both work through our LTD company as directors with 50% of the shares each.

The business has no assets or savings.

I’ve got a lot of personal debt (credit cards and overdraft) which I’m struggling to pay off.

If I went bankrupt, would it affect the LTD company?

Should I resign or leave the LTD company before trying to go bankrupt?

What proof do I need to provide to show that I am suitable for bankruptcy?

Thanks!

Replies

  • You better be clear on whether to resign or leave based on the debts you are having. Make sure you take preventive measures before you become bankrupt.
  • WhenIam64WhenIam64 Forumite
    1.1K Posts
    ✭✭✭
    You do not need to resign when bankrupt but you'd need permission of the court to continue to be a director (or involved in its management as a shadow director).

    But the first question is
    a) why have you chosen bankruptcy above other options and
    b) if the company is apparently valueless, are there other assets (home, car, shares) that need protecting in some way?
    Unlike some here, I am not omniscient. If I am wrong correct me. I won't take offence.

    The law is like an ocean - have a swim but don't drown.
  • WhenIam64 wrote: »
    You do not need to resign when bankrupt but you'd need permission of the court to continue to be a director (or involved in its management as a shadow director).

    But the first question is
    a) why have you chosen bankruptcy above other options and
    b) if the company is apparently valueless, are there other assets (home, car, shares) that need protecting in some way?

    Thanks.

    a) I haven't looked into the other options too much. I haven't missed any payments, but have a few zero percent cards that when they expire, I won't be able to keep up.

    b) No. We have no assets, either business or personal.
  • Thanks.

    a) I haven't looked into the other options too much. I haven't missed any payments, but have a few zero percent cards that when they expire, I won't be able to keep up.

    b) No. We have no assets, either business or personal.

    Have you run your circumstances by Business Debtline to see if they have any helpful advice? They're experts.

    Check out debt management plans, IVAs and consolidation loans which are bankruptcy alternatives too. Although, as you have no assets and if you don't mind the whole trashing of your credit file, bankruptcy might be a simple get-out for you.
  • terrence45 wrote: »
    Have you run your circumstances by Business Debtline to see if they have any helpful advice? They're experts.

    Check out debt management plans, IVAs and consolidation loans which are bankruptcy alternatives too. Although, as you have no assets and if you don't mind the whole trashing of your credit file, bankruptcy might be a simple get-out for you.

    I'd rather keep my credit file in good enough condition to rent privately.

    Would a debt management plan have a negative impact on it?

    I'd love to get a consolidation loan so that I'm not paying 25%+ interest on the credit cards, but I don't think I'd get one, as I have so much debt already.

    Are there any companies that give out consolidation loans with the understanding that the money will be used to pay off existing debt, therefore, they don't mind lending to people with existing debt?

    Thanks!
  • pcoventrypcoventry Forumite
    52 Posts
    10 Posts
    You would need to resign. I had to resign from a LTD as I hindered any chance of investment when I was involved. To this day I am still resigned even though it's a family business
  • edited 22 August 2019 at 10:15PM
    terrence45terrence45 Forumite
    132 Posts
    edited 22 August 2019 at 10:15PM
    I'd rather keep my credit file in good enough condition to rent privately.

    Would a debt management plan have a negative impact on it?

    I'd love to get a consolidation loan so that I'm not paying 25%+ interest on the credit cards, but I don't think I'd get one, as I have so much debt already.

    Are there any companies that give out consolidation loans with the understanding that the money will be used to pay off existing debt, therefore, they don't mind lending to people with existing debt?

    Thanks!


    I believe a DMP will affect your credit score - but best to check with one of the charity helplines. They're really very good.


    However, I don't think a DMP would appear on your 'public' credit file, which is all estate agents can ever see (if they even bother to do the checks they say they do!). A bankruptcy would show on there for 6 years.


    Many people think that estate agents can access their full credit files (with permission). Even Shelter's website suggests they can see all information about your past borrowing, but I can't find any evidence that this is the case.
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