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Alex J.
Alex J., Solicitor
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Experience:  Solicitors 2 years plus PQE
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I am a director of a non-trading, limited company in the UK.

Customer Question

I am a director of a non-trading, limited company in the UK. I am a legal resident of Australia, though a dual citizen (or Aussie citizen & British subject!).
I have recently had to declare personal bankruptcy in Australia and, as such, have had to resign all of my Australian directorships.
Can I continue my UK directorship or must I also resign that office?
Submitted: 2 years ago.
Category: Law
Expert:  Alex J. replied 2 years ago.
Hi,
Thank you for your question and welcome.
My name is ***** ***** I will assist you.
Do you own the shares in the company?
Kind regards
AJ
Customer: replied 2 years ago.

No, I do not own the shares in the UK limited company in question. Those shares (100 only) are owned by my wife.

However, I'd be interested to know why that made a difference. If I owned the shares (or owned 50-50) would the answer be different?

Many thanks,

Chris

Expert:  Alex J. replied 2 years ago.
Hi,
Thank you.
Technically as someone with a bankruptcy order against their name you should not be a director of a limited company in the UK. If you were the sole shareholder of the company in likely the company would liquidated and dissolved and the monies would then form part of your estate in bankruptcy.
As it is your wife is the owner of the company - therefore her assets (in the UK) do not form part of your estate and therefore there is no risk of it being broken up for your creditors.
Furthermore as the company is not trading there is no risk of creditors further detrimented by your bankruptcy. As this is an existing directorship I would say you would be ok to remain, however if the company begins to trade or you have a trustee in bankruptcy appointed in the UK you should consider resigning.
I cannot advise on the affect of Australian law in this regard - your Personal representative in Australian may require you to resign in the UK as well.
Kind regards
AJ
Customer: replied 2 years ago.

Thanks AJ,

Happy to understand that so far.

One last tweak to your answer, if I may. If she wants to buy another UK company (also non-trading) and wants to appoint me as a director in the UK - and this is obviously after the act/date of bankruptcy in AU - would that change the answer materially? (And, AJ, I do understand that the word "materially" is a lawyer's best friend or nightmare!)

Per your last para, I will take advice in Australia from my Trustee.

Best,

Chris

Expert:  Alex J. replied 2 years ago.
Hi,
Thank you - no problem I am happy to deal with any follow up points.
Yes it would change my answer materially - while you are bankrupt you should not be accepting new directorships.
If you can maintain existing ones because for example - the existing company will not be prejudiced by your bankruptcy then practically that is ok unless your trustee orders you to resign. However you cannot accept new directorships while you are an undischarged bankrupt.
If you want to set up a new company then you could consider appointing a nominee director until you are discharged from your bankruptcy.
Kind regards
AJ
Alex J., Solicitor
Category: Law
Satisfied Customers: 3611
Experience: Solicitors 2 years plus PQE
Alex J. and other Law Specialists are ready to help you
Customer: replied 2 years ago.

Thanks, ***** ***** all clear.

Expert:  Alex J. replied 2 years ago.
No problem.
I wish you the best of luck please do not hesitate to contact me if I can assist any further.
Kind regards
AJ

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