Debt Questions

If a person declares bankruptcy and moves abroad (to another EU country), do they have to give their creditors and the OR their new address?

I am considering this as it would be like 'wiping the slate clean' so to speak.

If say a few years down the line I wanted to buy a property out there/get a mortgage/credit etc, do I have to tell them about the bankruptcy in the UK and if so is it likely to affect me there as it would here?

TIA

Hi Maliana,

If you are declared Bankrupt and then move abroad, during the first 12 months of your bankruptcy only (pre discharge), you will need to inform the OR of any change of address(s) including due to moving abroad. You do NOT inform your former Creditors. After 12 months you are automatically discharged and no lnger need to advise the OR of any changes in your circumstances unless you have an IPA in place which lasts for 3 years.

This is becuase tduring the first 12 months he OR may need to ask you some questions from time to time or even send you forms to fill in for early discharge. Failure to cooperate can lead to a BRO/U put in place, your Bankruptcy suspended and more.

Also pre discharge you would also have to inform the OR of any other change in your circumstances eg income from a new job. Not sure exactly how the OR would find out about your income abroad but i have read here that it is best to cooperate fully with the OR. Post discharge, if no IPA in place then you do not need to inform the OR of anything.

In addition, the law is that you are bankrupt in the UK alone and bankruptcy does not follow you abroad. So you can open a new bank account and start building a fresh new credit history and new credit record permitting, you can get credit and a mortgage in your chosen country in future so it is indeed like a fresh start.

Hi - I declared myself bankrupt in June last year five days later I moved overseas. In my case I was unable to give an address where I could be contacted although I was asked. (I went to the Middle East which helped enormously). The OR did require an email address as they want to keep in contact with you. You just can't disappear - they would take a very dim view of this.

Although there is nothing wrong and certainly nothing to stop you going overseas once the bankruptcy process has been started you are legally required to cooperate with the OR until discharged. You could face an IPA and be asked to provide salary details and living expenses.

The bankruptcy process is very expensive - in addition to the money you owe your creditors there are the administration costs, and interest and VAT levied on the sums owed, and in my case this almost doubled the final amount. The OR will look at ways to get this money from you - either through the sale of your property or through an IPA.

My advice would be to cooperate as fully as you can - I did and got an early discharge and I didn't have to face an IPA.

For me going overseas was my only option - I was otherwise homeless and jobless in the UK and I am far better off now in so many ways.

I thought the UK had some arrangements with countries such as Germany regarding bankruptcy and credit scoring? Perhaps someone else can comment on that.

Hi Nomad, Thanks for your reply on this topic. At present I am considering a number of options as I am heavily in debt due to over borrowing to start a business. I have recently applied to a number of jobs in the Middle East and have lined up a few interviews.

If I get a job overseas I probably could afford to pay a large percentage of my interest on my debts each month. However, it will take many many years for me to pay the original debt off. My thought process is that if I declare myself bankrupt I will have a clean slate and be able to live with my family comfortably in the UAE.

Is there anything else you would recommend I consider before taking the initial steps of bankruptcy?

Any info will be greatly appreciated and acknowledged.

Hi,

I would definitely look at all your options before filing for bankruptcy. Either contact Payplan for advice or see the CAB for advice about business related debts. Try the repayment plan route first.

You should be able to make good regular repayments if you get the right job overseas. Depending on your location and contract you might even get free housing and in any case it is unlikely you would pay tax or utility bills. That would free a lot of income to repaying your debts. Depending on your career sector it is possible to make a lot of extra money 'on the side'.

Regard bankruptcy as a last resort because the longterm effects are very difficult to deal with. In the current climate I don't see myself ever returning to the UK - an exbankrupt would have little chance of getting a mortgage, I think.

I am currently in bankruptcy and have been offered a job overseas. However, I will be paid tax free in the UK.

Will the OR have any claim on this income. Any thoughts on how I should go about this?

As I understand it you have to tell the OR that you are working overseas but unless you are subject to a payment order you won't have to hand any of this over since you are overseas and they can't touch you.

It may be different if your employer is a UK company or if you are paid through a UK bank.

I'm not sure of the implications of being paid tax free in a UK bank account. I would have thought you would be better off opening an offshore account in the IoM.

If I was to go bankrupt and then move abroad - to Israel - to go on Kibbutz, when would I stand? I have no mortgage, no assets and no savings. On kibbutz I will not have a paycheck as any monies paid are in lieu of accomodation and food. Would I still need to let the OR know the details. Kibbutz doesnt have a proper address

You should but they would not ask for any money!!