Sometimes. It is better to just walk away.
A common scenario in today’s fast moving world:
- Cashflow issues
- Putting money into the business from your own resources
- Working 12-16 hour days for little or no return
- Red letters from HMRC for PAYE and VAT
- Red letters from suppliers
- Behind with rent and other payments
If any of the above feature in your business, it is possibly a sign of trouble. Sometimes these issues are temporary and will go away after a short while but at times these can be persistent and relentless and can make your life a misery.
Note: If you as a director continue to trade under a limited company while the company is insolvent, that is, unable to pay its debts as they fall due, you could potentially face allegations of wrongful trading as a director and potentially be disqualified from acting as a director in any future company. As a result of this, you could become personally liable for debts incurred by the company. If you are in any doubt, take advice from us immediately.
The good news is due to fairly favourable legislation in favour of entrepreneurship in the UK, it is relatively easy to walk away from all your liabilities in a limited company scenario if it is done in the right way. This is where can help. With our expert knowledge of this area and our close working relationships with Licenced Insolvency Practitioners, we can guide you through the whole process from start to finish.
There are several ways a company can go into liquidations:
- Creditors Voluntary Liquidation
- Members Voluntary Liquidation
- Compulsory Liquidation
By far the most common method is a Creditors Voluntary Liquidation, which is instigated by the directors of the company.
You could in theory go straight to an Insolvency Practitioner who will assist you in winding down the company and putting it into liquidation. However, you will have to do a lot of the legwork even though you might be paying the liquidator fees of £7,000 upwards depending on the size of the company and the amount of debt the company has.
So how can we help?
We take away all the headache from the moment you instruct us. We deal with all the paperwork and we appoint a liquidator on your behalf. We advise you of all the pitfalls and guide you through the process without the legal jargon. Typically, all you need to do is sign a few forms, give us a bit of background information and attend one meeting. We do the rest.
We have very close working relationships with the liquidators we appoint who are largely director friendly and can not only protect your interests but also obtain preferential rates for their services.
If you are having sleepless nights because your company is in trouble, get in touch today so you can sleep easy tomorrow!