Private assets and bankruptcy

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In case of bankruptcy, your assets are seized. This is used to pay debts as much as possible. This can be the company assets. Sometimes your private assets are also seized, such as your house, contents or car.

Should you use your equity to pay debts? That depends on the legal form of your business:

  • In an unincorporated legal form (such as a sole proprietorship), you are liable with your private assets. Business assets and private assets belong together.
  • In a legal form with legal personality (such as a private limited company), you are usually not liable with your private assets. Business assets and private assets are separated.

You can find more information about the two different situations on the KvK website.

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