What assets are included in your bankruptcy

When you become bankrupt you must tell the Official Assignee about all of the assets you own. If you do not, you may be prosecuted.

Examples of assets are:

• real estate
• cars and other vehicles
• bank balances
• tools
• lottery winnings.

Your house may be sold to repay your creditors. This will depend on whether there is any equity in the house (it's worth more than the mortgage(s) owed on it).

If your property is owned jointly with another person, the Official Assignee will talk with that person when deciding how to deal with your share of the property.

You must continue to make mortgage repayments and pay rates and insurance on the property while the Official Assignee is making the decision on whether to sell your share or not.

If you own a business then it may be shut down by the Official Assignee and any assets will be sold to pay your creditors.

Funds that you have in a Kiwisaver scheme are protected unless you withdraw them from the scheme during your bankruptcy.

If you're taking money out of your KiwiSaver because you're struggling financially, your KiwiSaver provider and their supervisor decide whether to release the money. You don't need to contact your Insolvency Officer.

You must keep filing tax returns. Any tax refunds claimed are assets in your bankruptcy and become the property of the Official Assignee.

If you have a term life insurance policy with no surrender value, you can choose to continue to pay the premiums.

If a claim is made during your bankruptcy the funds will be used to repay your creditors. If this happens you may be able to claim a refund of the premiums you paid.

You can choose to let the policy lapse instead, or someone else could purchase the policy from the Official Assignee if it might be difficult to replace (due to age, medical conditions, or increased premiums). If the policy has a surrender value, then it’s likely that it will be sold to repay your creditors.

You must tell your Insolvency Officer if you are owed any money. If any money is paid directly to you while you are bankrupt, it must be given immediately to the Official Assignee.

You can keep some assets to work and live, such as:

• tools needed for your work (up to a certain value)
• necessary household furniture and effects (up to a certain value)
• a car or motor vehicle worth up to $6,500
• money up to a maximum of $1,300
• items on hire purchase — but you'll have to continue making payments.