Business debt?

dingaling

Hi, I am a long time lurker and now I would love to have some help from you all.

Just looking for any info people may have.

We are probably going to have to go into liquidation, this is a very hard thing and very stressful, we have been unable to pay our rent on the business, now we owe the vat man and the rates. I was about £800 short for the wages too, but I can manage to stretch that out for the people who are owed.

However, we have leases on equipment that we have given personnal guarantees on, these are what worry me. Some of the stuff can be 'repossessed' by the lease companies, but will they come after us for the deficit. We have paid about 18 months on the leases that were taken out over 3 years. We have no personnal money/savings and very little to no equity in our house.

I feel completely rubbish, I had to make an employee redundant this morning, I gave him 2 weeks notice. This is all so difficult to cope with. We have had an insolvency practioner in as we were going to do a cva but we dont have the income to do it. I am worried about how much longer this can go on for as the debt just gets bigger and bigger.

I am here at the business on my own today and dont have the energy to deal with the customers/staff. Trying to keep a smiley face but not succeeding just now. I am in the office hiding from them all. Its not just the leases that we have, there are also a couple of cc's in our name that have been used for the business.

Any help would be greatly received.

philnicandamy

welcome....sorry to hear things are rough for you at the minute...what you need to do is contact business debtline (in my sig below) they are a totally free service & will give you some much needed free debt help advice

otherwise someone else will be along soon to hopefully answer your questions..

Triker

:hello: Hiya, don't worry there are some incredibly friendly helpful and supportive people here.

You'll be in safe hands.:D xx

dingaling

Thank you for your reply, we did speak to them a few weeks ago and at that point were talking about a cva, but that is now not an option. We will contact them again, I suppose I am scared about how much we will be left with as a personnal debt and whether we will be left with too much to cope with.

What are peoples experiences with equipment leases etc, these are hp agreements I think.

dingaling

Triker wrote: »

:hello: Hiya, don't worry there are some incredibly friendly helpful and supportive people here.

You'll be in safe hands.:D xx

Hi Triker:hello: thanks!

Fruit

Hi, Sorry to hear about your current situation. I had to wind up my own business in January as it was struggling to make ends meet and i didnt want to enter a situation of trading insolvently. Whilst it was a ltd company i also had given personal guarantees for car leases, phones, photo copiers and overdraft.

We were in a similar position in terms of little / no equity and no savings and following advice from an insolvency practioner decided to declare myself bankrupt.

The important thing is that you do not continue to trade knowing that the business is insolvent as this is illegal to my understanding and could cause you problems in the future.

Take proper advice but the process we went through was to pick a date for the business to cease trading ie end of the month. Write to all of your employees and creditors to inform them that unfortunately the business has ceased and provide them with contact details for accountants / liquidator. Invite any lease companies to collect equipment / cars.

From that point the guarantees will be passed to yourself which will most likely lead to bankruptcy. In our case the lack of equity meant that we are able to buy the beneficial interest in the property back from the OR however in twelve months time we will be able to start again without the onerous franchise fees etc.

Hope this is of some help / reasurance - try and look at things in a positive light - it's a fresh start!!

fiveyearplan

I had a limited company with business overdraft and loan etc. Unfortunately I had a personal guarantee on everything so I ditched the company - and declared personal bankruptcy. All the debt is gone. If you are a limited company and you take a personal bankruptcy then you can no longer have anything to do with the limited company so therefore if they come to you for the debt - guess what - you are bankrupt so don't owe it any longer.

Why don't you list up your debt, state if it is your debt or if wife/husband has signed also etc and we can give you some advice. I would also reitterate what Phil said and ring BDL again on Monday.

I know how you feel, I was in similar position last November, I went BR in April and I'm getting on!

dingaling

OK, its got a whole lot worse, dh is normally here but is away trying to earn money for us and I am here at the busniess. I have found letters in the to do pile that are very scary. We owe the vat man £8k, rates are taking us to court for £10k. I plucked up the courage to phone the vat man and say we are trying to sell as a going concern as it will be worth more money than it will closed. It is too late, they are likely to turn up here and demand payment in full or take goods, I explained that we dont own any of it, it is all on lease and she said to show them the lease agreements when they show up. I am now stressed beyond belief, not sure what to do, I need to sort myself out, I cant go back out to the customers and staff looking like this.

louleesop

Hi Dingaling

Please try not too worry too much. There are people out here who really have been through exactly the same situation as you and we have come out the other side. It is horrible when you are going through it, but once you face up to it, it isn't that bad. Take the advice of these great people, contact the help lines, get the help that is offered, and once you can answer that phone and open the door without your heart in your mouth it is wonderful!!

Just remember they can not take what you do not have!

L:o

fiveyearplan

Hi Dingaling - it would be worth speaking to Rog2 as he was in a similar situation. I'll pm him and ask him to look at this thread.

suffolkmum

Hi Dingaling,
another lurker here, but after reading your story today, had to sign up and reassure you that you are not alone, and am so glad to hear that it's not just me. We stopped trading in Jan, after not being able to pay rent and wages, and also the frightening post, and scary phone calls.
Just remember trying to serve customers one minute, and then dealing with angry suppliers next minute.
Finally came to realise that maybe not cut out to live life like that.
Thought we would try and do the 'right thing' and attempt to pay the debts- standing at £80 grand. Called all the creditors and arranged payments. Some were great and agreed to hold off till we were in employment, taking only really nominal payments. Others have gone to court, and have presently one bailiff knocking at door nearly every day threatening to sell all our furniture.
Sold our house to buy the business intially, so nothing to sell.
Still licking our wounds, but now feel only way out is to call it a day and declare bankrupt.
Strange thing is, cannot afford to do it!!!!!!!!!!!!