- BOUNCE BACK LOAN?
- HMRC ARREARS?
- TRADE CREDITORS?
- SLEEPLESS NIGHTS?
SAVE THE BUSINESS YOU HAVE WORKED SO HARD TO BUILD UP
If you have had your business for more than a couple of years then I’m sure you will have gone through blood sweat and tears (not to mention sleepless nights and money worries) to get your business to where it was at the beginning of March 2020.
Then, BANG! The World changed almost overnight and your business that had a bright and prosperous future is now probably fighting for survival. Well, it is possible, to save your business.
Firstly, in your mind, you need to separate your “Business” from your “Limited Company”. Although connected they are 2 different things. You may want to keep your “business” but get rid of the “Limited Company” that is insolvent and has too many debts and liabilities to survive.
If your Limited Company is in severe financial difficulties due to COVID-19 and the coronavirus it may be possible (and advisable) to liquidate the company to ensure that you are not breaching various insolvency laws such as Insolvent Trading and Fraudulent Trading to name just two. Directors can be penalised and held accountable for losses sustained if wrongful trading is proved.
By liquidating your Limited Company all the debts of that company will be written off and will disappear and you are legally allowed to set up another company to carry on in business without the burden and stress of all the debt of the previous company.
The above statement is very simplistic and there are lots and lots of factors to be taken into consideration before formally going down the liquidation route, if at all. Some of the other things to consider are:
- Personal Guarantees
- Overdrawn Directors Loan accounts
- Who can and cannot be directors of the new Limited Company
- S216 of The Insolvency Act regarding re-use of a company name
- Legally purchasing the assets, including goodwill, of the old company
- How to treat employees
- Fraudulent Trading
Liquidating a company can be quite complex, is always a last resort and we are not suggesting you should go down this route but if, due to the recent lockdown and massive business interruption, your company is in so much financial difficulty that you cannot see a way out then it may be the only option. The penalties for directors of companies that break insolvency laws can be heavy fines, imprisonment and/or disqualification from being a company director so it is very important that advice is taken as early as possible and you do not break any rules and laws.
We are not liquidators and only Insolvency Practitioners can act as liquidators but we know some liquidators very, very well. We deal with them on a daily basis, and have done for over 10 years, and we know the process of liquidating very well indeed.
We are here to provide you with the support and guidance encompassing the full spectrum of business rescue and recovery options. We can talk you through the variety of routes open to you and your company and suggest the most appropriate steps forward. This will always involve firstly trying to save the current Limited Company by negotiating with your creditors and looking at raising finance or investment. If, after looking at those options, we feel that an insolvency process could possibly be the best way forward then we will introduce you to one of the Insolvency Practitioners that we know who can then advise you on the insolvency options, including liquidation.
Once a plan has been decided, we will be with you every step of the way, guiding you and your company through this challenging time.
Please telephone us anytime on 0800 980 2662 or 0161 825 8094. Our lines are open 24/7, 365 days a year and will be answered by a human being. No queues or voicemail.
At no time will Business Advice Services, it’s partners, agents or employees be involved in the management of a Limited company or act as a Director of a Limited Company. At all times we act only on the instructions of the Directors of the company we are assisting for that specific task.