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Bankruptcy restrictions: what you cannot do

Bankruptcy comes with legal limits, usually for 12 months. Here is each one, what is not restricted, and when they can last longer.

Applies to: England & Wales

Written by The My Debt Cleared editorial teamLast reviewed 18 October 2026Next review 18 April 2027Jurisdiction England & WalesEditorial policy
While you are bankrupt you must not borrow more than £500 without telling the lender, act as a company director or help run a limited company without court permission, or run a business without telling people the name you were made bankrupt in. Restrictions usually end on discharge after 12 months, but a Bankruptcy Restrictions Order or Undertaking can extend them for between two and 15 years.

What to do now

  1. Check your contract or regulator’s rules if your job is regulated.
  2. If you are a director, take advice before applying.
  3. Tell any lender about the bankruptcy before borrowing more than £500.

The restrictions

  • Borrowing. You must not borrow more than £500 without telling the lender you are bankrupt.
  • Company director. You must not act as a director, or create, manage or promote a limited company, without the court’s permission.
  • Business names. You must not run a business without telling the people you deal with the name you were made bankrupt in, and any business name you use.

Breaking these can lead to prosecution.

Practical effects

  • Bank accounts. Your bank will usually freeze your accounts and may use money in them to repay what you owe it. Many people open a basic account with a different bank.
  • Your duties. You must co-operate with the official receiver or trustee and report changes in your income or possessions, such as an inheritance.
  • Jobs. Some roles have their own rules on bankruptcy — for example in financial services, law, accountancy or some public offices. Your employer or regulator can confirm.
  • Credit. The bankruptcy stays on your credit file for six years and on the Individual Insolvency Register until three months after discharge.

What is not restricted

You can usually keep working as an employee, rent a home, travel, and claim benefits. Self-employment can often continue, subject to the business name rule and the trustee’s view of business assets. Self-employed and in debt.

How long they last

Restrictions normally end when you are discharged, usually after 12 months. Discharge can be delayed if you do not co-operate with the trustee.

Restrictions orders and undertakings

If the official receiver believes you acted carelessly or dishonestly — for example by gambling with money owed to creditors, hiding assets, or taking on debt you knew you could not repay — they will first ask you to agree a Bankruptcy Restrictions Undertaking. If you do not agree, they can ask the court for a Bankruptcy Restrictions Order. Either one continues the restrictions for between two and 15 years and appears on the public register.

Compared with other options

A DRO has very similar restrictions for its 12 months. An IVA has no statutory director or borrowing restrictions, though its terms limit new credit. A DMP has none.

This page explains how the solution works. It is not a recommendation, and it cannot tell you whether it suits you — a free, regulated debt adviser can look at your full situation.

You can get free, impartial debt advice

You never have to pay for debt advice. MoneyHelper (government-backed), StepChange, National Debtline and Citizens Advice all give free, confidential advice with no obligation.

Common questions

How much can I borrow while bankrupt?

Up to £500 without telling the lender. For more than £500, you must tell the lender you are bankrupt.

Can I be a company director if I'm bankrupt?

Not without the court's permission while you are undischarged. The restriction usually lifts on discharge unless a restrictions order or undertaking is made.

How long do bankruptcy restrictions last?

Usually until discharge, normally after 12 months. A Bankruptcy Restrictions Order or Undertaking can extend them for between two and 15 years.

BankruptcyDRO restrictionsSelf-employed debtIVA vs bankruptcy
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