And so I face the final curtain…
It’s a damming statistic but over half of all UK start up businesses fail within the first few years of trading.
There are many reason behind this but essentially opening, operating and succeeding in businesses is an inherently difficult and challenging task, and one that is only compounded by tax and compliance obligations.
There are broadly two ways a company can be declared insolvent, firstly if it cannot meet it’s liabilities when they fall due, and secondly if it’s liabilities are greater than its assets.
Directors have a responsibility to address both of these issues as soon as they become aware, if they continue to trade whilst insolvent they could become personally liable for the debts incurred.
The accountants and tax advisors at F9 Consulting can provide practical advice through to the appointment of a licensed Insolvency Practitioner who can arrange a Company Voluntary Arrangement (CVA) or where this is not a viable solution a Creditors Voluntary Liquidation (CVL).
Liquidations are not solely for insolvent companies, a Insolvency Practitioner is also required to wind up the affairs of a solvent entity where capital treatment is desired on the distributions to shareholders, these liquidations are known as Members Voluntary Liquidations (MVL) and F9 are able to manage MVL’s from the initial tax planning stages through to cessation of trade, assignment of the licensed Insolvency Practitioner and reporting of personal taxes.
The sooner you act in relation to debt problems the better the result will be and corporate insolvency should not impact on your personal credit rating if you act in good time.