Let’s face it – personal bankruptcy is not great. I have written articles in the past about how the regime works and the positive (yes, positive) and negative aspects about going bankrupt.
A common question that comes up when I meet people, which can often prove to be the biggest area of concern, relates to a bankrupt’s ability to travel internationally.
As the saying goes, a little bit of knowledge is a dangerous thing, and it can prove quite unsettling when someone learns, from an unreliable source, that they cannot travel overseas if they become bankrupt.
Aside from holidays, a major pain point for people is the incorrect perception that they will be unable to travel overseas to attend a wedding, care for a sick relation or sadly, attend a funeral of a family member or friend.
The thing is, a bankrupt individual can travel overseas – they just need to get their Trustee’s permission first.
How is permission obtained? It’s quite easy – you just need to provide the following details:
- The reason for travel (holiday, work conference etc.)
- The dates of travel and the countries that will be visited
- Contact details for whilst you are away
- Being up to date with any income contributions that may be due for payment
- Who is paying for the trip (and if it is not you, a letter from the party that is paying)
- If travelling for work, evidence from your employer as to the reasons for the travel
The points above are all centred around establishing that the bankrupt person is not a flight risk, that they are not fibbing on their income questionnaires about how much they are earning and that if they do owe their estate some money, they are all square before leaving the country.
For example, if a bankrupt person reports income resulting in no contributions to their estate, a first class trip throughout Europe for a month will raise suspicions from their Trustee about what is really going on.
Additionally, if an individual owes money to their estate for income contributions, their Trustee will normally insist that the payments are caught up before allowing the person to travel.
So if you are contemplating bankruptcy and international travel is a particularly concerning consideration for you, I trust that this article has allayed your worries.
If you have any questions about how this article may apply to your circumstances, please feel free to pick up the phone and give me a call.
About the author
Greg Quin is a Director at HLB Mann Judd Insolvency WA and has been with the team for 10 years. Greg oversees the daily operations of the many insolvency appointments managed by the HLB Insolvency team and looks after the operations of the practice.
If you have any queries about insolvency matters, please feel free to contact Greg on 08 9215 7900, 0402 943 091 or via email to gquin@hlbinsol.com.au.
