Life can take an interesting course, and it can result in us having to leave the UK. Whether it’s for business or pleasure, it’s always an exciting moment to move away to pastures new and start up again somewhere else.

What’s less exciting is trying to organise all your affairs before you go. These could well include wondering what you might do about your outstanding debts if you have any. Can you leave the UK with debt? And if so, how can you do it? 

Well, as with anything to do with debt, it’s quite a complex issue. We’ll take a deep dive into leaving the UK with debt and the various rules around it.

Debts abroad

The short answer to whether you can leave the UK with debt – yes, you can. However, there are lots of things to bear in mind. Your debt remains on your permanent record, so if you do go to another country and you try and open a bank account, or even start a mobile contract, you may find it hard to get these accepted owing to your unpaid debt. 

Renting could also be a bit of a nightmare – if you were to try and eradicate your credit record, renting anywhere privately would quickly become impossible. You would also not be able to get any benefits, and if you wanted to stay under the radar and have no digital financial imprint, being paid in cash would be the way to go. 

This opens up a new set of issues, in that you are setting yourself up to be exploited, as you could be paid well below the minimum wage, and you may not receive proper holiday pay or sick pay.

Foreign debt collection agencies

Sometimes, leaving the UK with debt will not make them go away. There are debt collection agencies in the UK who have international links, so if you plan on leaving the UK with debt, it’ll follow you to your next destination. 

This could lead to these partner companies taking action in your new home country, such as claiming assets and freezing bank accounts that you might hold in that country. The original creditor may not even have to link up with another debt collection agency at all though.

Bankruptcy

Leaving the UK with debt might result in the creditor making you bankrupt, even if you aren’t in the UK anymore. This could cause serious problems, as bankruptcy is recognized across borders and in most European countries. In addition to this, many other countries across the world are also part of international agreements where their courts or insolvency services will cooperate with this bankruptcy.

So despite being made bankrupt in the UK, you could end up paying the price in your current home country, and any assets or property you own will be under threat. It should be noted though that there is no guarantee of them pursuing you in another country, but there is every chance that they might.

County Court Judgment

You may also think that your debt could become statute barred after 6 years away, thus meaning your debt can no longer be legally enforced. Regardless of where you are in the world, the creditor could apply to get a County Court Judgment against you, and it is worth knowing that County Court Judgments can be enforced upon your return to the UK – even after 6 years.

If you leave the UK with debt and you don’t supply your creditors with your new contact details, they will serve the legal action to your last known address. If you do notify the creditors of your new address in your new home country, legal action can only be started in that country.

‘Set Aside’

Another piece of information that also affects the County Court Judgment they take against you is the possibility of getting it ‘set aside’. This is when the County Court Judgment is legally deleted. 

This can happen if you can prove you never received the court papers, if you were in hospital for instance, but not getting the papers because you never gave your creditor your new address is not a good reason to have the County Court Judgment set aside.

Coming back to the UK

Leaving the UK with debt will put you in a tricky position, especially if you are planning on returning at some point. If you don’t provide a forwarding address, then there could be all sorts of things happening behind your back that you don’t know about.

The debt that you still owe could end up accruing a huge amount of interest and overdue charges, meaning that you will owe much more than you bargained for. In addition, the creditor could apply for a County Court Judgment, which would eclipse any chance of the debt becoming statute barred.

Leaving the UK with debt – what to do

The best way you can deal with any debts you still owe, while you are abroad will depend entirely on your situation – just as it would if you were in the UK. Nine times out of ten, you will be able to continue making payments towards your debts while you are abroad. These should be at the amounts you have previously agreed with your creditor.

Making the payments from abroad could become a bit trickier, as you would have to do this by bank transfer. This is a slightly more complicated process, using what’s known as an IBAN transaction, and there may be fees to pay to do this. You should contact your bank for more details. 

Sometimes doing this will be impossible, owing to international sanctions that forbid the transfer of cash from country to country. So leaving the UK with debt can end up being more of a headache than it might be worth.

Signing off

So that’s the low down on leaving the UK with debt. In short, it can be done, but it’s not advised for you to go along with it at all – the repercussions are considerable, and you may find yourself in a trickier situation than you were in before. 

Leaving the UK permanently won’t just write your debt off, as you might think it will. So it’s best to either settle up before you leave, or let your creditors know your new address and continue your payments as normal.

About the author

Scott Nelson

Scott Nelson is a financial services expert, with over 10 years’ experience in the industry, including 6 years in FCA regulated companies. Read more
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