Bankruptcy and foreign issues

This fact sheet covers England & Wales. You will need different advice if you live in Scotland.

This fact sheet tells you when you can go bankrupt in England or Wales if you live abroad. Bankruptcy is an official order that ends your liability for most debts after a certain period of time, usually one year. If you are struggling to pay your debts, bankruptcy can help you to make a fresh start. However, bankruptcy is a serious option and it is important that you understand what bankruptcy means before choosing to apply.

Use this fact sheet to:

check if you may be able to go bankrupt in England or Wales when you live abroad;
understand what is likely to happen after you go bankrupt;
understand the effect that a bankruptcy order in England or Wales may have on you abroad; and
see if your creditors may still be able to take action against you abroad after you have gone bankrupt in England or Wales.

Bankruptcy in England or Wales if you live abroad

If you live outside of the UK, you can still go bankrupt in England or Wales if you:

have lived in England or Wales at any point in the three years before you apply for bankruptcy; or
have had a business in England or Wales at any point in the three years before you apply for bankruptcy.

You cannot go bankrupt in England or Wales if you are living in Scotland or Northern Ireland.

A bankruptcy order in England and Wales will not be automatically recognised abroad and creditors may still take action against you in the country you are living in. For more information, see the later sections Moving abroad after bankruptcy, Assets abroad and Foreign creditors.

How to apply

You must apply online at www.gov.uk. Your application will be sent to an adjudicator at the Insolvency Service. They will check that you cannot pay your debts as they fall due and that England or Wales is the correct place for you to go bankrupt. This means that if you do not meet the criteria described in the earlier section Bankruptcy in England or Wales if you live abroad, your application will be refused. You do not have to go to a court hearing. The adjudicator will make their decision within a maximum of 28 days of receiving your application.

If the adjudicator refuses to make a bankruptcy order, they will send you a notice to tell you this. This is called a ‘notice of refusal’. This notice must tell you why the adjudicator did not make you bankrupt. You can ask the adjudicator to review their decision but you must do this within 14 days of the notice of refusal being delivered. When the adjudicator reviews their decision, you cannot provide them with any new information. You must give reasons for asking the adjudicator to review their decision, but they can only consider the information you provided with your original application. If the adjudicator still does not make you bankrupt, they must send you a notice to confirm this.

You can appeal to the court against the adjudicator's final decision. You must do this within 28 days of getting the notice which confirms the adjudicator’s decision following your request for a review. If you want to appeal to the court against an adjudicator’s final decision, you will need extra help. Contact us for advice about finding the type of help that you need.

After bankruptcy

After a bankruptcy order has been made, you will need to provide the official receiver with further information. The official receiver handles the administration of your bankruptcy. You may be asked to complete further forms or provide certain documents. The official receiver may ask you to attend their office for an interview. In some situations, they may be happy to interview you over the phone.

Unfortunately, these documents cannot be completed before a bankruptcy order is made, and you cannot pre-book an appointment for the interview. However, if you explain your circumstances to the official receiver, for example that you are only in the country for a limited period, they may try to arrange an appointment for you as soon as possible. Alternatively, they may agree that the interview can take place over the phone. You must provide any information that the official receiver asks you for. If you cannot do so, think carefully about whether bankruptcy is the right option for you. Contact us for advice.

Your trustee in bankruptcy will take control of your assets and contact your creditors. The trustee will either be the official receiver or a separate insolvency practitioner.

Moving abroad after bankruptcy

If you go bankrupt in England or Wales and then move abroad, you may need to apply to a local court to have your bankruptcy recognised. This also applies if you move to Scotland or Northern Ireland as these countries have different bankruptcy laws.

Whether your bankruptcy can be recognised in another country depends upon whether that country has any agreement about this with the UK. If there is no agreement in place and your new country does not recognise your bankruptcy, your creditors could try to take action against you there. There may be other effects in that country of your bankruptcy from England or Wales.

You should seek legal advice in the country that you intend to move to about the effects of going bankrupt in England or Wales. Contact us for advice about how to find suitable legal help.

If you are already bankrupt

If your application for bankruptcy was made before 11:00pm on 31 December 2020, your bankruptcy should be recognised by other EU member states (except Denmark). This means that your creditors will not be able to take action against you there. However, there will be restrictions on you in the country that you move to. Seek advice in that country about what these restrictions are likely to be.

Assets abroad

All your assets transfer to your trustee in bankruptcy after the order is made. This applies wherever the assets are in the world. There are only very limited exceptions to this rule.

The trustee may find it difficult to sell assets that you have abroad. This is because the other country may not recognise their authority. This may mean that the trustee has to take legal action if they want to deal with those assets.

You may need legal advice about the effect of bankruptcy on your assets abroad. Contact us for advice about how to find suitable legal help.

Assets in the EU if you are already bankrupt

If your application for bankruptcy was made before 11:00pm on 31 December 2020, your trustee should be able to deal with any assets you have in the EU (except Denmark).

Foreign creditors

If you go bankrupt in England or Wales, the following points apply.

All of your creditors in the world will be included. This means that they cannot take action against you in England or Wales to recover the money you owe.
Creditors may still try to take action against you in countries outside of the EU.
If you have any assets abroad, creditors may be able to take action which puts the assets at risk.

This is a complicated area. You may need specialist legal advice. We may be able to help you find suitable legal advice. Contact us for advice.

Creditor action if you are already bankrupt

If your application for bankruptcy was made before 11:00pm on 31 December 2020, creditors will not be able to take action against you in the EU (except Denmark).