Bankruptcy

[BrilloPad]

Ive had enough of BN66 and am desperate to terminate my liability. I hate my job and am thinking of giving it up anyway. Apparently bankruptcy will terminate my exposure to HMRC and my spousal maintenance. And my pension cannot be touched. I have no savings and almost no equity in the house - mrsbp2 wants a divorce anyway and would get the house as part of that.

I have looked quite alot online and am thinking of going to see an insolvency practioner.

I can live cash in hand for a year - I dont care for credit anyway.

Are there any disadvantages? Any particular questions I should be asking an insolvency practioner?

[speling bee]

Ive had enough of BN66 and am desperate to terminate my liability. I hate my job and am thinking of giving it up anyway. Apparently bankruptcy will terminate my exposure to HMRC and my spousal maintenance. And my pension cannot be touched. I have no savings and almost no equity in the house - mrsbp2 wants a divorce anyway and would get the house as part of that.

I have looked quite alot online and am thinking of going to see an insolvency practioner.

I can live cash in hand for a year - I dont care for credit anyway.

Are there any disadvantages? Any particular questions I should be asking an insolvency practioner?

Do you work in sectors that frown on bankruptcy?

[eek]

Do you work in sectors that frown on bankruptcy?

Does this help...

I hate my job and am thinking of giving it up anyway.

I can't give you any advice really but life is short so make the most of it...

[BlueSharp]

Sorry to hear you predicament. I would ask about an Independent Voluntary Arrangement (IVA) and if it is more suitable to your needs. The timing of the bankruptcy/IVA is also important if divorce is on the cards with mrsbp2 as they could come after any shared assets or spread the liabilities so worth asking about that to.

[speling bee]

Sorry to hear you predicament. I would ask about an Independent Voluntary Arrangement (IVA) and if it is more suitable to your needs. The timing of the bankruptcy/IVA is also important if divorce is on the cards with mrsbp2 as they could come after any shared assets or spread the liabilities so worth asking about that to.

Would an IVA get HMRC off his back? I doubt it.

[BlueSharp]

Would an IVA get HMRC off his back? I doubt it.

I think if HMRC accept it as a full and final then it would, if they don't accept it then they can force bankruptcy. An IP would know for definite.

[d000hg]

Ive had enough of BN66 and am desperate to terminate my liability. I hate my job and am thinking of giving it up anyway. Apparently bankruptcy will terminate my exposure to HMRC and my spousal maintenance. And my pension cannot be touched. I have no savings and almost no equity in the house - mrsbp2 wants a divorce anyway and would get the house as part of that.

I have looked quite alot online and am thinking of going to see an insolvency practioner.

I can live cash in hand for a year - I dont care for credit anyway.

Are there any disadvantages? Any particular questions I should be asking an insolvency practioner?

How do you propose becoming bankrupt exactly? And how can you "live cash in hand for a year" after going bankrupt - isn't the point of bankruptcy you have to give your creditors everything?

[craig1]

My closest friend went through a similar situation last year with huge HMRC debts, she ended up going bankrupt as HMRC refused to sign up to an IVA. All the bits below are based what I learned while helping her through it, it's my complete layman's understanding so get proper advice and don't rely on this.

IVAs bind all creditors for past liabilities if they accept, that includes HMRC. That said, HMRC might say that there's no debt yet if they've not issued a demand. That's an area that definitely needs careful assessment by someone who understands these things so you don't get bitten later with it.

Also, you'd need to be legally separated to ensure that there's a break between you and your soon-to-be-ex if you want to keep your house excluded. If the house is still partly in your name then both IVA and bankruptcy would see charging orders made on your house if there's no equity to be recovered. Even then, if the OR or IVA overseer see any handovers to your ex as an unfair transfer then they could ask the court to reclaim some from them.

Be aware though with insolvency practitioners that they'll cost you a fair bit of money and may not be right in their answers, be clear up front what advice you want from them and how much they'll charge you. What the court and/or OR will rule might be completely different, all depending on how they assess your circumstances and culpability for going bankrupt. If you do decide that bankruptcy is your only route out then go direct to the court yourself rather than through the insolvency practitioner as it'll save you a whole bunch of money.

(This paragraph assumes you're the 100% shareholder and sole director) Get your ltd company's books in good order as if you go bankrupt you will almost definitely lose immediate control of them but still can be liable for things that go wrong. Treat the company as if you're about to close it down, get your statutory filings done early and settle any outstanding incoming or outgoing monies. Cancel any direct debits and standing orders and expect every penny in the bank account to be seized if you leave it there. The OR would probably assess any money in there isn't essential for your day-to-day living and treat it as fair game.

Get yourself a basic bank account with one of the few banks that won't cut your account off if you go insolvent. You need to do it before you go insolvent as I don't believe there are any now who will give an undischarged bankrupt an account. My friend went with the Co-op, got their really basic account and is happy with the choice. If you're going to have more than £1000 or so in your personal accounts or cash-in-hand then you need to have a clear cash-flow saying what it's going to be used for, for example how that's going to be your sole source of income over the term of the bankruptcy.

Finally, if you hate your job, hate your current circumstances and really want a change then do it. It sounds like you've no core responsibilities beyond your ex and your HMRC liabilities so as long as you have a post-bankruptcy plan for where you're going to live, do and so on then it all comes down to how much you want to change things.

[psychocandy]

Apologies. Unfair comment from me.

[speling bee]

So bail out owing tax which the rest of us have to pay ultimately and keep your pension for old age?

Wonder why everyone doesnt do it? :-)

If he has debts that he cannot pay, then that is what the bankruptcy laws are for.

Of course, you could just leave him be, as he's obviously in a tough spot and asking for help in a professional forum.