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How Bankruptcy Affects My Business

You should consider the effects of bankruptcy in your business since this can cause a devastating impact on your trade. Moreover, the intensity of such effects can differ regardless of your company’s scale. So, whether your business is single ownership, partnership, or a corporation, its gravity will differ.

Effects of bankruptcy as a sole trader

You still can continue trading as a self-employed individual regardless of your claim for bankruptcy. However, this may not be true to all circumstances. In fact, it is acceptable for an official receiver to decide whether to sell your business or continue your trade.

Generally, under bankruptcy law, you can keep the essential tools, which you use for your job. Thus, an OR or an official receiver cannot dispose of such tools. However, an official receiver can sell your stocks and other unsecured assets.

Under such circumstances, the employees working on your business are normally dismissed, and all official records related to your trade will be provided to the official receiver.

Effects of bankruptcy in a limited company

When you go bankrupt, you cannot continue as a director of a limited company.

Besides, as soon as you declared bankruptcy, you are forbidden to get hold of certain positions that involve operations and management unless you are granted consent or permitted by the court.

So, during the bankruptcy period, you are prohibited to conduct business trade of any kind under your name unless you divulged the information to the people involved.

FREE Bankruptcy Advice

You cannot afford to lose your business out of bankruptcy. If this happens, it can have a drastic impact on the overall aspect of your business. However, it is never too late.

We suggest that you contact us so we can give you realistic advice on how you can deal with your situation. Keep in mind that bankruptcy can impact your career as a member of the professional bodies where you belong.