Bankruptcy: Don’t take it personally
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Personal bankruptcy is just one of a broad range of different options now open to individuals and small-business owners who find themselves facing financial difficulty.


And while it may be the best option for your specific circumstances, there are alternatives that you should also consider, before declaring personal bankruptcy.


This was highlighted in the recent case of Shane Filan, the Westlife singer whose fortune was wiped out by the property crash in Ireland.


Following several years of double-digit property price growth, the bubble burst, in a classic case of boom-and-bust that left Filan disastrously out of pocket.


He declared personal bankruptcy, and is now looking to an attempted solo career to help earn back a liveable amount of money.


But for those in business, there are several other options to help resolve debt difficulties.


Corporate insolvency can allow you to declare a business bankrupt, without necessarily facing the same individual limitations that you would with personal bankruptcy.


For instance, you may be able to continue to hold a full bank account, retain ownership of personal possessions like your house and car, and manage a business again in the future.


Smaller debts can be tackled with less formal debt instruments, like an individual voluntary arrangement, which again typically involve less stringent sanctions.


And we would always urge small businesses to look to their outstanding invoice book as a possible source of unexpected extra funds.


Remember, you can usually charge penalty fees and statutory interest – at a rate of around 8% – on overdue amounts.


For those that were payable several years ago, that can make pursuing unpaid debts from your customers a very lucrative option indeed, which could prove to be enough to get your company cash flow back into the black.

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