Bankruptcy: don't manage your money like Martine McCutcheon
Nineties star Martine McCutcheon has become the latest celebrity to be made bankrupt. We look at why she's ended up in the red, and what happens next.
Martine McCutcheon was one of the nineties’ biggest soap stars, famous for playing Tiffany on EastEnders. She also played Natalie in the blockbuster film Love Actually, as well as enjoying brief success as a singer, her debut single ‘A Perfect Moment’ hitting number one. Despite that success, it's now emerged that at the start of the year she was made bankrupt.
It seems that Martine’s debt problems have stemmed from unpaid taxes. This is a real hazard for the self-employed. The petition was made out in Martine’s full name and follows in the wake of other unpaid tax-related celebrity bankruptcies.
She’s not the first; famously, former Atomic Kitten star Kerry Katona (now the face of a payday loan provider’s advertising campaign, as Lovemoney covered in Kerry Katona: the latest celeb to flog a dodgy financial product) has her bankruptcy listed on the publically searchable insolvency register.
When counselling self-employed clients we always make sure that full provision for any taxable liabilities is made within the budget. We make it clear to clients that this money shouldn’t be spent under any circumstances.
It’s still unusual for a creditor to make a debtor bankrupt. However if the creditor is HM Revenue & Customs (HMRC) there’ll have been various warnings of action before they petitioned for bankruptcy.
Just like the clients we advise, Martine will now find that the Official Receiver or an Insolvency Practitioner (the latter if one is assigned by the court) will take a good look at all her financial affairs. This could include freezing her bank accounts.
The Official Receiver or Insolvency Practitioner will also have a good look at any assets (such as property and vehicles) Martine has that could be realised for the benefit of creditors within the bankruptcy.
Martine’s employment status is listed as a performer/writer and she’ll need to work with them to put together a realistic budget that she can live on and continue to earn a living wage. They may take Martine’s lifestyle into account and any request to earn showbusiness wages, but her budget won’t be extravagant.
Many recent celebrities who have suffered from money problems have found a way out through reality television shows such as ‘I'm A Celebrity... Get Me Out Of Here!’. It might be that Martine will be looking for similar quick ways to maximise her income to improve her situation.
If you’re interested in reading about more celebrity bankruptcies read I'm a celebrity, make me bankrupt!
If you’re worried about your financial situation it’s always best to seek advice as early as possible. You can phone our free Helpline or use our anonymous and free online debt advice tool Debt Remedy.