After your bankruptcy has been formally declared, all your assets deemed to have re-sale value will likely be seized and re-sold in order to raise money to contribute toward the repayment of your debts. You will be required to pass over control of your assets to an individual assigned to preside over your bankruptcy. This individual is usually entitled your “trustee” and can be:
- A licensed insolvency practitioner
- An official receiver- a representative of your presiding county court
To start with, your official receiver will typically occupy the role of your trustee.
Assets you will be allowed to retain
Typically, you will be allowed to retain ownership of the following:
- Itinerary you own which is vital for your occupation, such as your toolkits or car (though both might be sold and replaced with cheaper versions in order to repay some of your debt)
- Items which are essential to your day-to-day living, such as your bed, furniture, garments and crockery.
Your bank accounts
Under the terms of bankruptcy, you are legally obligated to provide you Official Receiver with all your debit and credit cards, cheque books and financial information for accounts you are barred from utilising. This is applicable to all accounts that you were overdrawn on from the day you were formally declared bankrupt.
All of these accounts will be frozen, through your Official Receiver might decide to provide you with:
- Any cash you might require in emergencies or for essential living purposes, such as for food or utility bills.
- Your partner’s allocation of cash in a joint account the two of you have.
After your bankruptcy has come to an end, it will be up to your account holders whether you will be allowed to carry on utilising them.
It’s up to your bank if they allow you to continue using the accounts.
If you are an on approved pension scheme, then the money in your pot will be protected under the Welfare Form and Pensions Act of 1999. However, the safety of your pension savings whilst you are bankrupt is dependent on which pension scheme you are on, and it would be worth visiting the Insolvency Service site and reading their official guide about what will happen to your pension. This can be done at: https://www.gov.uk/government/publications/bankruptcy-pension