Personal bankruptcy & owning own company

June 17th, 2010 by Questions

I am planning on claiming personal bankruptcy because I owe back alimony to my ex-wife and had an agreement to pay her until she`s 65 which is nine more years, and I also own my own company, will I have to pay her any back alimony, and will It mean that i will not have to pay her until she`s 65, also can I keep my company If I claim personal bankruptcy?

Posted from: Ontario

Questions

One Response to “Personal bankruptcy & owning own company”



, Barton Goth - Goth & Company Inc. -Trustee in Bankruptcy said:

From your above post there are two issues you need to be aware of.

First, the filing of a personal bankruptcy cannot release you from back alimony. Maintenance, alimony and child support all fall into a category of debts that are not released by filing bankruptcy. So if the intent behind the bankruptcy is solely due to alimony you may want to reconsider your plan.

The second issue relates to your company. First, during bankruptcy you are not able to be a director of a limited company. So if you are operating in this capacity you would have to transfer the directorship into someone else’s name. The second issue is that the shares of the company are considered a personal asset. As a result they must be valued and potentially realized on for the general benefit of creditors. So there may be some impact on your company depending what type of company it is, how you have it set up, and the nature of the business and the assets associated with it. As this can often be a complicated issue I would recommend that you discuss it directly with a local trustee for more details on this.

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