Questions you have before making a decision to go Bankrupt and the Bankruptcy process

Moderators: TalbotWoods, JaneClack

By mt
#8335 Does anyone know of any bank that will allow me (just gone bankrupt) to open a basic business account? I've searched on the web and found some companies that guarantee they can open one for me but charge a fee. What do they do on my behalf to get the account opened that I can't do myself? Anyone with experience in this area?
By Pineapple
#8336 I don't think there are any basic business accounts. But you do know that the law does not require you to have a business account, don't you? It's the banks that want the chance of those extra charges.

I've been self-employed for 11 years now and only ever used a personal account. When I went bankrupt I switched to the Nationwide and Coop. The only problem I had was when a stupid client paid into my old account, despite the fact that I had given them the new details three times. :roll:

I know loads of self-employed people who just use personal accounts. Though I suppose the bank are less likely to give you a hard time if - like me - you just have a few payments per month in and out than if you have loads [e.g. a retail business][/i]
By mt
#8340 Thanks zadie. I had a business account before I went bankrupt but presumably they would not allow me to have it back. Have you found integrating business transactions in your personal account easy enough? I mean when it comes to paying tax etc. I guess all I need to do is have business categories for my expenses and income in the software I use. Having a separate business account is easier but if I can't get one then I suppose I'll go this route. Thanks.
By Mel_Odious
#8344
mt wrote:
found some companies that guarantee they can open one for me but charge a fee.

We are often asked about these. I have seen a few posts where people have sent money and received nothing. If they are genuine, they are usually set up with foreign banks that do not adhere to British banking regs, so any problem with them and you will have no recourse to action.
Another problem being that that they are very expensive to run; with annual charges, charges every time you use the account, charges for exchanging their currency to Sterling in fact charges on any transaction.
Barge poles and not touching should come to mind.

Mel
By mt
#8429 Thanks Mel I will stay clear of them. Not a problem, as my business has very few transactions so I'll just use my personal account for now.
By Pineapple
#8430
mt wrote:Thanks zadie. I had a business account before I went bankrupt but presumably they would not allow me to have it back. Have you found integrating business transactions in your personal account easy enough? I mean when it comes to paying tax etc. I guess all I need to do is have business categories for my expenses and income in the software I use. Having a separate business account is easier but if I can't get one then I suppose I'll go this route. Thanks.



MT, sorry to be slow getting back to you, but don’t touch these companies. You will not find a bona fide bank that will offer you a business account as a bankrupt.

But I’m still baffled about why on earth you would want one. Why pay charges when you don’t need to? I – and many other self-employed people – don’t want or use them, regardless of bankruptcy.

My knowledge is out of date, but a year ago there were three current accounts available to Ubs – Coop, Nationwide and Woolwich. Just set one or more of these up. If you want to put money aside for tax, use another of them. Or you might be able to open a non-credit checked savings account. When you are discharged [max one year], then you may be able to open another basic [i.e. non-business account] that is available to discharged bankrupts. Isn’t that enough?
By mt
#8436 Oh I see what you mean now zadie. A bit slow there I'm afraid - too preoccupied with my petition and OR interview :wink: Never occured to me before to use another separate basic account for my business. I don't have many transactions anyway, just a few per month. You're right, why pay the charges?

Thanks!
By mt
#8437 One question though zadie... if someone pays me a cheque in my company name, would I be able to deposit it into a basic current account??
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By JaneClack
#8440 .... why not ask them to make it payable to you as you must be a sole trader anyway?

Zadie knows her stuff so she will be back to tell you anyway - all I know is that when I was a sole trader bringing hundreds of little French adolescents over here to learn English I used to pay my host families with third party cheques from my basic bank account. Only in one area and the bank was really nice about it and did me a few per day as they knew it would only happen two or three times a year.....
By Pineapple
#8459 MT, what is your status? Do you have a limited company and pay yourself as a director? If so, you might have to change this - I don't think bankrupts can be company directors.

Or are you a sole trader, "trading as [trade name]", e.g. Joe Bloggs, trading as Computer Repairs? If so, you might have to temporarily drop the Computer Repairs and/or get clients to pay money to Joe Bloggs. I'm afraid I don't know much about this, as I've only ever traded as Joe Bloggs. Best ask the examiner - more than likely you will see one specialising in sole traders - I did. But I expect you're in the clear with that. When I had phone contact from the court with the OR office, the member of staff checked with the examiner that it was OK for me to continue trading - and it was. Good luck. :)
By mt
#8461 Zadie, I'm a sole trader. I know definitely that I am allowed to carry on trading, provided I don't use a new trading name.

I have always asked people to pay me in my company name because it is more professional. But I guess I'll just have to ask them to pay me in my own name.

I spoke to my OR about the possibility of my bank letting me keep my business account. He said it's completely down to the bank, and as I was always in credit with my business a/c, it is possible. He told me to speak to the bank directly in a couple of weeks' time.

Thanks.
By Pineapple
#8482
mt wrote:Zadie, I'm a sole trader. I know definitely that I am allowed to carry on trading, provided I don't use a new trading name.

I have always asked people to pay me in my company name because it is more professional. But I guess I'll just have to ask them to pay me in my own name.

I spoke to my OR about the possibility of my bank letting me keep my business account. He said it's completely down to the bank, and as I was always in credit with my business a/c, it is possible. He told me to speak to the bank directly in a couple of weeks' time.

Thanks.


Ah, OK, good to hear that you're not director of a ltd co.

Yes, it IS up to the bank to decide whether to keep your a/c open - once the OR has declared no interest in it. But I really wouldn't hold your breath - it's extremely rare for banks NOT to close down a bankrupt's account.

But as I said, I never was a fan of business accounts anyway - even years before debts/bankruptcy became an issue in my life. There are lots of charges, cheques are not easily accepted, etc. The ONLY advantage I can see to the a/c holder [as opposed to the bank :roll: ] is being able to use a 'trading as' name. I've no idea what it's like in your field, but in my area everyone trades under their own name. I think for the meantime you'll probably have to ask your clients to pay you under your own name ... but that surely is a minor inconvience. :?
By mt
#8512 I'm sure you're right that my old bank won't let me have my business account back. So I will use a basic current account. Like I said I only have a few transactions a month anyway. Thanks zadie.