Need advice on going bankrupt with a business

Frank33

A company I owe money to is trying to make me bankrupt. The debt is large and is 5 years old.

I have no means of paying the debt at the moment and probably won't for a while. I can pay say £500 a month. But they would not accept that as the interest is eye watering and compounds daily! 

I am however self-employed and have started a company which has potential. 

I appreciate that I will not be able to stay as a director and my wife will need to be the sole director.

However, I am the main person in the business.

So how does this work? Can I still be involved in the company? I have no other income or means of income. If I am not involved the company will not make money and I will not have any income to pay the rent and other bills.

I have no assets - my wife and I rent. My car is on a private lease. My wife has a car.

I do owe money on credit cards etc.

Bankruptcy seems like the best route to make the debts go away. 

But my concern is the company that I have started and any future companies that I want to try and earn money from.

Could really do with some advice as to how I can protect that business and any potential future income.

luvchocolate

Hi try calling business Debtline as a starting point 

Minkym00

It's not just that you can't legally be a director, you can't run the company at all and, if you're in charge, you're effectively just hiding behind your wife. The only option open to you if you are bankrupt is to make an application to a court and request leave to act as a director. The Official Receiver will object to this, so you would need to have a compelling argument.    

Frank33

Minkym00 said:

It's not just that you can't legally be a director, you can't run the company at all and, if you're in charge, you're effectively just hiding behind your wife. The only option open to you if you are bankrupt is to make an application to a court and request leave to act as a director. The Official Receiver will object to this, so you would need to have a compelling argument.    

Thanks.

I have no concerns about not running the business - but I am the face of it - if there is no issues in me promoting the business as any employee could then it isn't an issue. 

Appreciate your input

noitsnotme

"While you’re bankrupt, there are some restrictions on the involvement you can have in running a business. If you break any of these restrictions you'll be committing a criminal offence. They include:

• you can't be a company director without permission from the court

• you can't be involved in setting up, promoting or managing a limited company without permission from the court"

https://www.citizensadvice.org.uk/debt-and-money/debt-solutions/bankruptcy/how-bankruptcy-affects-you/check-how-bankruptcy-affects-your-job/#:~:text=If you break any of,without permission from the court

missimaxo

I would highly recommend going for leave to act under s17 rather than getting into the nitty gritty of being an employee vs being a director. Leave to act is granted for bankrupts usually with conditions like keeping hmrc up to date. Promotion of a business is a key element of breaching s11 when the insolvency service look at evidence, along with evidence of acting as a director and s11 is a criminal offence not just civil.