Bankruptcy and Moving Abroad

Are you currently bankrupt and planning to move abroad? This article explains everything you need to know about bankruptcy and moving abroad.

Moving abroad to a country outside the EU

The rights of entry into a country will be dictated in their immigration policy. Although being a discharged bankrupt may make leaving a country more difficult, it should not be impossible. You may however need to seek further specialist immigration advice as to your rights to enter a specific country.

Declaring bankruptcy in the UK whilst abroad

If your main place of residence is now provable as England or Wales, and bankruptcy proceedings are not in progress elsewhere then you can apply for your bankruptcy in the UK and it will include any unsecured, provable debts from overseas. You can find details of the bankruptcy application process on the Gov website.

Before proceeding it would be worth running through your details with a free debt adviser to identify any consequences that you may experience as a result of a bankruptcy or to see if there are any alternatives.

On the other hand, if you now live abroad and want to know if you have been made bankrupt, there is a public register where you can find a list of current bankruptcies. The limitation is that you can only view the details of current bankruptcies, those that have ended in the last 3 months and current bankruptcy restrictions orders and undertakings. You can also personally contact the relevant organisation to see if they can update you on any actions they have taken with regards to the debt owed and whether there is any debt remaining today.

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Declaring bankruptcy abroad

Depending on which country you declare bankruptcy in the circumstances can be very different, as each country normally has its own bankruptcy laws. For example in Spain, you will be discharged from your liability for all debts you have in the UK. The UK has a reciprocal agreement with Spain which means that any assets or monies that vested in the bankruptcy would be dealt with by the Insolvency Service in the UK. Any student loan or tax debts would be collected by the HMRC in the UK.

We suggest you find a reputable company abroad to assist you with bankruptcy. Please see our useful links and resources at the end of this post.

Can I go abroad If I am Bankrupt?

There is no restriction on travel for people declared bankrupt in England, Scotland or Wales, provided your destination country has no objections. There is a restriction for those made bankrupt in Northern Ireland. If you are based in Northern Ireland you will need to speak to the Official Receiver (OR) who is dealing with your case. In which case, you will need to ask for ‘leave of the court’ before you can leave the country.

But there may be a few things you need to consider before travelling:

  • Ensure you are not using credit facilities or funds that should be paid into the bankruptcy.
  • As a bankrupt, you have a duty to co-operate with the OR.
  • if you will be travelling abroad for an extended period of time then the OR may be unable to contact you.
  • If your income changes due to working abroad then you will still need to inform the OR of any changes even though you are not in the UK.
  • Further to that, you will need to inform the OR of your new address, employment status and of any change to your financial circumstances.

Will my bank account abroad be affected?

Bankruptcy deals with all assets and all liabilities worldwide and you are legally required to disclose details of all your assets to the OR including those abroad. You must also remember that the OR is able to exercise power outside the UK. If you have funds in a bank account abroad then it will be of interest to the OR and it may be that a negligible sum of money is of no interest. If the money is yours then it automatically vests with the Trustee in bankruptcy and they will seek the money.

Initially, they can simply ask you to hand over the money that is in the bank account abroad and if you fail to comply then they may look at action to recover the money. If you refuse then it could be that you are ordered to do so and you may even end up being subject to restrictions for longer than the bankruptcy. Your bank account abroad can also be frozen, depending on the OR’s decision. As with bankruptcy in the UK, you can request the bank account to be unfrozen. For more information on bank accounts, please read our article on bank accounts after going bankrupt.

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How does bankruptcy affect property abroad?

In bankruptcy, all your assets are potentially bankruptcy assets including assets in other countries or abroad. There are cases, where the OR will not be interested in your property abroad. For example, if your property abroad has very little equity, in which case a third party can buy that equity out and pay that money into the bankruptcy. For more information on how your debt could affect your property, please read our article on debt against property.

Getting a job abroad after declaring bankruptcy:

I would get some visa advice about whether it would be affected by bankruptcy. Obviously, if they knew about your bankruptcy then you won’t have a problem.

Things to watch out for. You must stay in contact with your Trustee while bankrupt otherwise you may be guilty of absconding. If you are moving within the European Union bankruptcy may affect you.

Please note that if you work for a UK company who are posting you abroad things are very different compared to if you are working for a foreign company with no links to the UK (or EU).

Need more help?

If you need further help, Debt Advice Foundation provides a free, confidential helpline and can advise you. Click here to find out more. You can also find more free debt advice on our debt help page. You may also find the Bankruptcy From Abroad website useful.


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