Does My Company's Bankruptcy Affect Me Personally?

2009-10-02   minute read

Donna Carson

If a corporation files for bankruptcy, the Trustee will deal with the assets and creditors of the corporation.  A corporate bankruptcy does not mean that you have personally filed and will not show up on your credit report.

Person talking on their cellphone looking over paperwork

What will affect you if you are personally liable for any of the debts of the company.  Being a shareholder of that company does not make you personally liable for the debts of the company.
What does make you liable is:
1.  if you signed any personal guarantees of the debt
2.  if you were also a Director of the corporation.  Directors are personally responsible for unpaid payroll remittances, unpaid GST, and certain wages.  There may also be some personal exposure for corporate income taxes, if you were paying yourself dividends from the company.

Another scenario is that the corporation doesn't actually need to file for only needs to formally shut down.

If you like, give one of the Trustees in your area a call to discuss your company's situation, and if there is any personal risk to you.

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