After Acquired Property

June 2009


1. What is after-acquired property?

After-acquired property is any property (but not income) which has been acquired by or devolved upon the bankrupt since the commencement of the bankruptcy proceedings. Section 307 of the Insolvency Act 1986 allows the trustee of the bankrupt’s estate to formally claim such property by notice in writing for the benefit of the estate.

The trustee may claim such property even if the trustee only becomes aware of the property after the bankrupt’s discharge, providing it was acquired by, or devolved upon, the bankrupt between the date of the bankruptcy order and the date of discharge.

Generally speaking, the trustee would consider claiming as after-acquired, any property which would have been an asset, if it had been in the possession of the bankrupt, at the date of the bankruptcy order. Conversely, any asset which would have been treated as exempt and in the possession of the bankrupt, at the date of the bankruptcy order, would not normally be considered as after-acquired property. This means that the usual exemptions for tools of trade, household equipment and some motor vehicles will still apply (see Case Help Manual part: Exempt Property).

2.Electronic delivery of documents and notices

(September 2010)

With effect from 6 April 2010 the Insolvency Rules allow for certain notices and information to be sent or received by electronic means, provided that the intended recipient has consented and provided an electronic address for delivery. Where the notice is sent by the official receiver, the recipient must also be advised that they can request a hard copy.

In terms of after-acquired property, these provisions mean that the official receiver could accept notice of after-acquired property from the bankrupt by email if he/she had given consent to the bankrupt for electronic communication either generally or in relation to this specific notice. The official receiver could also make his/her claim for the after-acquired property electronically provided the bankrupt had consented to that method and provided an electronic address.  

Any reference in this part to a document or information in “writing” includes that document or information in electronic form provided it is capable of being produced in a legible form.  

3. How does the trustee become aware of after-acquired property?

The bankrupt has a duty to co-operate with the trustee, specifically as regards notifying the trustee in writing of any after-acquired property within 21 days of becoming aware of its existence. This requirement is set out in form NTB2 which is served on the bankrupt in every case and requires a signed copy to be obtained for the office file, which acknowledges that the bankrupt has read and understood the document. Any notification from the bankrupt by telephone should be followed up and the bankrupt requested to confirm in writing. However, the official receiver should not fail to take any action just because written confirmation is not received from the bankrupt.  

Often a creditor or other third party will contact the official receiver if they believe that the bankrupt has acquired property of which the trustee is unaware. Valid notification can be received not only in writing but also via telephone and e-mail. If information is received in this manner, appropriate enquiries should be made of the bankrupt to enable the official receiver to consider whether a claim to the after-acquired property is appropriate.

See Technical Manual Chapter 31.8.11, where notification of the acquisition of property is received outside of the 21 day period.

HMRC may contact the Official Receiver directly regarding a possible tax refund. Tax refunds are income and as such may be claimed via an IPA/IPO, they should not be claimed as after-acquired property (see paragraph 16).

4. Should the trustee claim all after-acquired property?

Before claiming any property under section 307, the official receiver as trustee should be satisfied that the realisation will produce a net benefit to the estate, although a small margin for error is permissible should the agent’s valuation prove to be over-optimistic or realisation costs are higher than expected.

5. What will happen if no trustee has been appointed yet?

The legislation states that only the trustee may claim after-acquired property for the estate. If, however, the official receiver whilst receiver and manager, becomes aware that there is property which could be claimed, he/she should inform the bankrupt that once a trustee is appointed the trustee will contact him/her with regard to the property. The bankrupt must also be told that the trustee may then choose to claim the property  for the benefit of the estate and that, although the bankrupt has been allowed to retain the property, no steps should be taken to dispose of the property in question in the meantime.

If the official receiver is unhappy about the safety of the property, especially where the bankrupt is being unco-operative, all steps necessary to protect it should be taken. This includes taking it into safe custody if this is deemed to be the most appropriate course of action. However, the official receiver as receiver and manager may not dispose of the property without the leave of the court and thus should seek the appointment of a trustee (including him/herself) as soon as possible.

6. How long does the trustee have to claim after-acquired property?

Once the trustee is aware that there is after-acquired property, he/she then only has 42 days to make his/her decision on whether or not to claim the property, in writing, for the benefit of the estate. The 42 day period begins with the day on which the knowledge of the property came to the attention of the official receiver, as trustee. This period may be extended by the court but it is unlikely to do so if the delay in dealing with the matter is the result of an unreasonable delay on the part of the trustee.

Where the official receiver is still receiver and manager of the estate, when after-acquired property is drawn to his/her attention, the 42 day period will commence on the day a trustee is appointed, whether the trustee is the official receiver or an Insolvency Practitioner (IP).  

7. What happens if an IP is appointed?

If an IP is appointed and notice of after-acquired property was originally given to the official receiver as trustee (see paragraph 3) the IP is deemed to have had knowledge of the asset at the same time. The 42 day period, therefore, begins with the date that the official receiver as trustee received notice and not the date of the appointment of the IP. The time limit for claiming after-acquired property is not extended where an IP is appointed as trustee.

It follows that in cases where there is knowledge of after-acquired property and an IP is to be appointed, the estate should be handed over as a matter of urgency to avoid any potential loss of value to the estate. The official receiver may wish to consider giving the IP advance notice of the property or even claiming the property, to ensure a claim is made within the 42 day period (see Technical Manual Chapter 31.8.21).   

8. How does the trustee claim after-acquired property?

To claim after-acquired property, the official receiver as trustee should serve written notice (form ASTCAA) on the bankrupt with a request for acknowledgement. The notice is normally served by both recorded delivery and ordinary 1st class post but could be given by electronic means if the bankrupt has consented to electronic communication and provided an address (see paragraph 2). If the official receiver is in any doubt about whether the electronic address provided is still being used by the bankrupt, service by post should also be used. This notice notifies the bankrupt that the property being claimed must not be sold or disposed of and should be kept safe and secure.

The property vests in the trustee as soon as notice (form ASTCAA) is served on the bankrupt and the trustee‘s title to the property goes back to the time that the bankrupt acquired the property and therefore the official receiver should take steps to deal with the property quickly.

Once the property forms part of the estate, it should be insured, if appropriate, and removed to sell as soon as possible. Depending on the nature of the property claimed, the bankrupt should then be asked to either deliver up the property to the official receiver or his/her agents or make it available for collection. The official receiver should also issue letters to third parties such as banks or an executor of a will to protect his/her interest and consider registering his/her interest in any land deemed to be after- acquired property. The official receiver must protect his/her interest in land by means of an application for registration of a bankruptcy restriction (solely –owned) or application for a Form J restriction (jointly-owned).

For the procedure when registering the official receiver’s interest in land see Case Help Manual parts: Freehold Property – Solely-owned: Registration of a bankruptcy restriction and Freehold Property – Jointly owned: Registering a Form J restriction.

9. What if the bankrupt no longer has the property in his possession?

Where the property in question has been disposed of to a third party by the bankrupt, either before or despite his/her receiving notice of the trustee’s claim, the trustee has 28 days from the date of becoming aware of the third party’s name and address to claim the property on behalf of the estate. This should be done using form ASTCAA. However, if the third party acquired the property in good faith, for value and without having notice of the bankruptcy order, the trustee has no remedy against him/her or against anyone else the third party may have passed the property onto. In these circumstances, the trustee can request the bankrupt to pay to the estate the proceeds of sale or, if this is not possible, a suspension of the bankrupt’s discharge might be sought until such time as the bankrupt has repaid the value of the property to the estate.

10. Can the trustee disclaim property claimed under section 307?

(Amended September 2010)

Property previously claimed by the trustee for the benefit of the bankruptcy estate cannot subsequently be disclaimed as onerous without the permission of the court.

Any application for permission to disclaim must be accompanied by a report outlining the details of the property and setting out the reasons why permission to disclaim is now being applied for, when the property in question was previously thought to have been of value to the estate.

If a notice to elect is received, or any similar notice requiring that, within 28 days, the official receiver decides whether to disclaim a property or not, the normal 28 day period will need to be extended by the court to enable the application for permission to disclaim to be considered. 

For further information see Case Help Manual part: Disclaimers.

11. Are there any assets which are exempt from the after-acquired property provisions?

Any assets that would have been exempt under the provisions of section 283(2) as at the date of the bankruptcy order will normally still be exempt property for the purposes of the after-acquired property provisions (section 307). Generally this will include such items as:

  • tools of trade, household equipment and some vehicles, although where the trustee feels an item that would be exempt ordinarily is of excessive value, he/she can claim it as after-acquired property and replace it with an item of less value purchased with funds from the estate (see Technical Manual Chapter 31.8.34)
  • clothing, bedding, furniture, household equipment and provisions as are necessary to satisfy the basic domestic needs of the bankrupt and his/her family
  • any property held on trust for any other person
  • a dwelling house/interest in a dwelling house which has re-vested in the bankrupt under the “three-year rule” (see Case Help Manual part: The Family Home).

12. What assets may or may not the official receiver claim?

Paragraphs 13 to 26 below list the most common examples of assets which the official receiver may have to deal with. The list is not exhaustive and further less common examples can be found in Technical Manual Chapter 31.8 part 3.

13. Criminal Injuries Compensation Authority

The trustee may not claim compensation paid to the bankrupt under the Criminal Injuries Compensation Scheme for personal injury, although there is a possibility that the trustee can claim any award for loss of earnings. The matter should be referred to the examiner for advice.

14. Redundancy payments

In a redundancy settlement the element of the payment in lieu of notice, as payment of compensation for not having received the full notice period and the actual redundancy payment, as compensation for loss of a job, is considered to be an after- acquired asset and claimable by the official receiver as such. The element of the payment in respect of holiday pay and arrears of wages is considered to be income and as a result is claimable under an IPO/A.

Compensatory awards made by Industrial Tribunals are considered to be property rather than income and can thus be claimed as after-acquired property.

15. Rights of action

A bankrupt retains his/her right to pursue any action for physical or mental suffering, from either injury to his/her person or his/her reputation. If the bankrupt is successful and awarded compensation in the form of damages as the result of such action, the trustee may not be able to claim those damages as long as they remain in the form of damages during the period of bankruptcy. However, if the damages change character and are invested in property or used to purchase another asset the trustee can claim the property as after-acquired.

See Technical Manual Chapter 31.8.41, 42 and 44 for further details on rights of action which may be considered after-acquired assets.

16. Tax Refunds

The official receiver should not claim tax refunds as after - acquired property. Instead, refunds due for tax years prior to the date of the bankruptcy order and for the tax year in which the bankruptcy order was made can be claimed using the bankrupt’s duly completed Income Tax and National Insurance disclosure authority form TNIDIS. Any refund in respect of tax years after the tax year in which the bankruptcy order was made may be claimed by means of an income payments agreement/income payments order (IPA/IPO) where the bankrupt remains undischarged. When a bankruptcy order is made against an individual who is subject to PAYE a nil (NT) tax code IPA/IPO may be applied for.

For further guidance see Case Help Manual parts: Income Payment Agreements, Income Payment Orders and Tax Refunds

17. Interest under a will

The trustee can claim an interest under a will when such interest devolves upon the bankrupt before discharge. This means that if the person who made the will dies during the period prior to the discharge of the bankrupt, the trustee can generally claim the property bequeathed to the bankrupt, under the provisions of section 307, even if it is not received by the bankrupt until after his/her discharge.

Where, however, the property is left to the bankrupt under a protective trust the trustee will not be able to claim the property.  A protective trust is usually created in relation to freehold or leasehold property and gives the beneficiary of the trust a time-bound interest in the property (such as a right to occupy to a certain date) without having the right to sell it.

Where the official receiver encounters a protective trust, and the property is of sufficient value to justify it, he/she should seek legal advice to establish the validity of the trust and explore any means of challenging it.

In all cases, notice of the bankruptcy order (NORD1) must be given to the trustees/executors of the will as soon as possible. If the official receiver becomes trustee a second notice should also be sent in duplicate, with the trustees of the will being asked to return one copy receipted for the file (form NEXE).

Notwithstanding the bankruptcy order, a bankrupt retains his/her right to challenge the provisions of a will under The Inheritance (Provision for Family and Dependants) Act 1975 and the trustee plays no part in such proceedings.

18. National Lottery wins

Where the official receiver receives information to suggest that a bankrupt may have had a National Lottery win, he/she can make enquiries of the National Lottery (Camelot) on 01923 425174 (contact: Tony Proctor). In order to provide information confirming or denying the win, Camelot will need to have sight of the bankruptcy order and no meetings notice (NNM) confirming the official receiver’s appointment as trustee or an authority completed by the bankrupt.

The National Lottery usually pays out monies relating to wins within two or three days of the win.  Where a payment has yet to be made, Camelot can withhold payment on the request of the official receiver where the bankruptcy order confirming the official receiver’s appointment or bankrupt’s authority is provided.

19. Build up of funds in the bankrupt’s bank account

Where there has been a gradual build up of funds in the bankrupt’s bank account it is likely that the source of those funds will have been a from a surplus of income and the official receiver, as trustee, should consider laying claim to those monies in the account that are in excess of those necessary to satisfy the basic domestic needs of the bankrupt and his/her family.  Where the trustee wishes to lay claim to monies of this nature, the claim should be under an IPA or IPO (see Case Help Manual parts: Income Payments Agreements, Income Payments Orders) rather than as after-acquired property, and an IPA/IPO to claim the monthly surplus should also be considered.

Where the source of the funds is from some other (non-income) source (for example, small gambling wins), then the monies can be claimed as after-acquired property.

20. Property Transfers

Where the bankrupt has been involved in the transfer of an interest in a property using the low-cost conveyancing scheme the property can not then be reclaimed by the official receiver as after-acquired property, since there is an understanding that once transferred, the bankrupt has ownership of the property without the official receiver making a claim over it.

For more information where the official receiver becomes aware that the funds used to enable the transfer are from an after-acquired source or property is received under matrimonial proceedings see Technical Manual Chapter 31.8.48/9.


If a bankrupt receives shares from a Save As You Earn scheme (SAYE) during the period of bankruptcy, the shares and subsequent dividends may be claimed as after-acquired property. There is no need for a separate after-acquired claim in respect of the dividends.

Similarly, dividends being received in relation to shares held by the bankrupt as at the date of the making of the bankruptcy order, would be automatically due to the trustee as assets arising from the possession of the shares vesting in the estate.

Where the bankrupt receives shares following a demutualisation, merger or similar of a financial institution (e.g. a building society) of which they are a member, the shares are considered to be a personal asset – being awarded in exchange for them giving up personal membership rights. It is considered that the shares are held on trust by the bankrupt for the trustee in bankruptcy.  As beneficiary, the official receiver could, generally, require the bankrupt to sell the shares and realise the bankruptcy estate interests. Where the value of the shares makes it worthwhile, the official receiver should lay claim to the proceeds of the shares as after-acquired property.

22. Student loans

No part of a student loan may be claimed as after-acquired property but see Technical Manual Chapter 31.8.53 regarding other loans received whilst an undischarged bankrupt.

23. Employment bonuses

Where a bankrupt receives a bonus from his/her employer, this should be claimed by the trustee under an IPA/IPO, rather than as after-acquired property, as a payment in this respect comes under the definition of income.

24. Pensions

The vast majority of pension benefits do not vest in the trustee and therefore they may not be claimed as after-acquired property as a matter of course, although the pension payments and lump sum payments can be taken into account for IPA/IPO purposes. For further information see Case Help Manual part: Pensions.

If you are unsure whether an item can be claimed under section 307 or not, refer the matter to the examiner. 

25. Property acquired in the ordinary course of business where trading continues after bankruptcy

(Amended September 2010)

The provisions relating to the giving of notice in respect of after-acquired property do not relate to property acquired by the bankrupt in the normal course of business (i.e. the buying and selling of goods and the passing of business monies). In order to give the trustee some control over this, the Rules do require that the bankrupt provide the trustee, with information relating to the business showing the total of goods bought and sold and the profit or loss arising. For cases where the petition was presented on or after 6 April 2010 the trustee can request profit and loss information at his/her discretion. For cases where the petition was presented before 6 April 2010 the information must be provided every six months.

The trustee has power to require fuller details (including accounts) where appropriate.

In this way the trustee can monitor the bankrupt’s business and lay claim to profits, though this would be claimed as income under the IPO/IPA provisions.

It is also possible that an excessive amount of stock being carried by the business could be claimed as after-acquired property.

26. Capital sums invested in a business

If a capital sum acquired by the bankrupt personally is invested in the business, the trustee may claim the monies or assets acquired with those funds if they can be traced. Otherwise, an order could be obtained to suspend discharge until such time as the after-acquired property is restored to the estate.

27. How does discharge from bankruptcy affect after-acquired claims? (updated October 2013)

The period in which it is the duty of the bankrupt to notify the trustee of any after-acquired property begins with the date of the bankruptcy order and ends with the date of discharge.

If the official receiver becomes aware that the bankrupt is likely to be receiving an after-acquired asset (i.e. a redundancy payment) then he/she should not file a notice of early discharge. In any event, a  notice of early discharge should not be filed for any case where the bankruptcy order was made on or after 1 October 2013.

For further information on discharge see Case Help Manual part: Discharge from bankruptcy.

See also Technical Manual Chapter 31.8.27/8 regarding action to be considered where the bankrupt fails to co-operate.


  • In the case of a deceased insolvent, the trustee can still claim after-acquired property for the estate. It is possible that the estate of a deceased insolvent could benefit from a contract entered into prior to the insolvent’s death coming to fruition or that property could devolve upon the debtor under the terms of a will (see Technical Manual Chapter 31.8.31).
  • Where an individual has a bankruptcy order made against him/her and he/she has previously been bankrupt, any after-acquired property from the first bankruptcy which has not yet been distributed, will become an asset in the later bankruptcy.
  • A second 42 day period does not commence to run if the case is transferred between offices i.e. to RTLU and a new official receiver as trustee is appointed. If the official receiver in the “home” office cannot be completely sure that a subsequent office will claim the property in the 42 day period, he/she should make the claim, to avoid loss of any property due to time limitations.

Where can I find out more?

Insolvency Act 1986:

Section 283(2) and (3) Definition of bankrupt’s estate

Section 287 Official receiver as receiver and manager

Section 307 After-acquired property

Section 309 Time limit for notice

Section 310(7), 310A(4) Definition of income for IPA/IPO purposes

Section 312(1) and (4) Bankrupt’s obligation to surrender property to trustee

Section 315(4) Leave (permission) of court required to disclaim

Sections 334 and 335 Adjustment between earlier and later bankruptcy estates

Section 376 Right of court to extend time limits

Section 436 Definition of property

Insolvency Rules 1986 as amended by Insolvency (Amendment) Rules 2010:

Rule 6.182 Application for permission to disclaim

Rule 6.183(3) Court’s right to extend 28 day period re notice to elect

Rule 6.200 Duties of bankrupt in respect of after-acquired property

Rule 6.201 Trustee’s recourse to disponee of property

Administration of Insolvent Estates of Deceased Persons Order 1986,

Schedule 1, Part II, Para 23

Technical Manual:

Chapter 31.7. Income Payments Agreements and Income Payments Orders 

Chapter 31.8 - Realisation of After-acquired Property 

Chapter 54 – Deceased insolvents 

Case Help Manual:

Discharge from Bankruptcy


Exempt Property 

Freehold Property 

Income Payment Agreements 

Income Payments Orders 


Tax Refunds 

The Family Home  

Forms to be used:

NORD1 – Notice of order

NTB2 – Notice to bankrupt

ASTCAA – Asset claim to non-excluded or after-acquired asset

TNIDIS – Tax and NI disclosure

NEXE – Notice to Executor


After Acquired Property flowchart



LOIS screen references are given in brackets e.g. (DO73)

Since there are time limits within which the official receiver must claim after - acquired property, correspondence and replies must be dealt with promptly.

1. Receive information that bankrupt is believed to have after-acquired property. A claim must be made within 42 days so ensure matter dealt with promptly.

2. Where official receiver is still only receiver and manager, write to bankrupt instructing him/her not to dispose of the property in question and informing him/her that, once appointed, the trustee of his/her estate will contact him/her in due course to investigate the matter further.

3. If an IP has previously been appointed trustee, forward the correspondence to him/her.

4. Where the official receiver is trustee and the information has not come from the bankrupt himself/herself, immediately write to the bankrupt for full details.

5. Diarise reply and if no satisfactory response is received from the bankrupt, refer the matter to the examiner for further instructions.

6. Where the bankrupt informs the official receiver of a change of circumstances which involves his/her disposable income, send form IPOQ (IPO, questionnaire) for completion. On receipt of reply refer to examiner to consider whether a suitable case for an application for IPA/IPO or if an IPA/IPO is already in place, to consider varying the agreement or order.

7. Where the property consists of an interest under a will, write to the trustees of the will using form NEXE (DO73) and await reply.

8. If the bequest takes the form of a protective trust, no further action can be taken. Note the file and LOIS where appropriate (CA08/CA15).

9. If there is some uncertainty regarding the value of the property under consideration, ask agents to prepare a valuation. If the property has little or no value and is unlikely to result in a net benefit to the estate, inform the bankrupt that the trustee will not be claiming the property as an after-acquired asset.

10. Note the file and LOIS, where appropriate (CA08/CA15).

11. If property is to be claimed, serve the bankrupt with notice (form ASTCAA) claiming the property under the provisions of section 307, using both recorded delivery and ordinary 1st class post (unless instructed to use another method for service).

12. Await return of signed copy. Chase up, if necessary.

13. Ask the bankrupt to deliver up the property to the official receiver or arrange for the agents to remove it where applicable. Ask the examiner whether the property should be insured.

14. If the property consists of solely owned land make usual enquiries of any mortgagees and if appropriate, prepare form LRCBI (DO73), application for registration of a bankruptcy restriction, and send to the Land Registry.

15. Where the property is jointly owned land make usual enquiries of any mortgagees and if appropriate prepare form LRCLET (DO73), application for Form J restriction and related letters, and send to Land Registry.

16. If the land is not currently saleable, prepare papers and pass to RTLU advising them of the date the official receiver claimed the property.

17. Once the property claimed under section 307 has been sold, note LOIS if appropriate (CA08/CA15).

18 If the bankrupt states that the property has been passed to a third party, write and ask bankrupt for the new "owner’s" name and address.

19. Write to third party and claim the property in question for the bankruptcy estate using form ASTCAA. This must be done within 28 days of having an address for the third party.

20. If the third party obtained the property from the bankrupt in good faith, without being aware of the bankruptcy order and for value, the trustee has no course of action against him/her. Note LOIS if appropriate (CA08/CA15).

21. Write to the bankrupt explaining the situation and asking for the proceeds of sale to be paid over to the official receiver as trustee. If the bankrupt refuses, refer the matter to the examiner to decide whether to suspend discharge.

22. If it appears that the property previously claimed under section 307 ought to be disclaimed, or where notice to elect (or similar notice requiring a disclaimer decision)  has been received in respect of the property, obtain confirmation from the examiner that a disclaimer is required.

23. Draft application to court for permission to disclaim together with report outlining the reasons for the disclaimer. Send signed application to court.

24. If the court grants permission to disclaim the property, prepare disclaimer papers in the usual way. For further information see Case Help Manual part: Disclaimers.

25. If no permission to disclaim granted, pass the papers to the examiner to deal with.