Business debt?

rog2

Hi dingaling - there are so many of us, here, who have gone through what you are going through.
Well done for having plucked up the courage to phone the VAT man. He, along with his countrepart from Inland Revenue, was one of my toughest creditors.
You are going to need to sit down, with your DH, and possibly with someone from Business Debtline, and put your problems into perspective.
Make a list of all of your debts, then make a list of your business income.
You say that you have had to give 'personal' guarantees on the leases - this is 'normal practice' with business loans - creditors don't want to deal with 'sole traders', but they also look for protection from the very protection that a 'limited company' status gives to its directors - don't worry too much about that for the moment.
Once you have done all of this, you then need to try and take an objective look at the overall scene, without, if possible, being side-tracked by creditors, like HMRC (VAT), who will be trying their best to try to make their own debts gain 'preference' over your other creditors.
You say that you have employed the services of an 'Insolvency Practitioner' - may I ask in what capacity, as he/she does not appear to have been contributing much in the way of positive suggestion?
Sorry if I'm rambling a bit - I'm trying to get the wider picture.
Since you appear to have very few assetts, has personal bankruptcy been suggested?

fiveyearplan

Thanks for your input Rog2.

rog2

dingaling wrote: »

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.

In a strange way, they may be doing you a favour ( I know it doesn't seem like it) but ask yourself if the business is, indeed, sellable as a 'going concern'?

Even if the answer is yes, then will the proceeds pay your debts? Unless the answer is definitely yes, then all you may be doing is making lots of work for yourself and only 'prolonging' the inevitable.

fiveyearplan

Had things not come to a head with my business I can see that I might still be trying to struggle on and borrowing more money to make it work. Now, I'm glad its all over.

rog2

suffolkmum wrote: »

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!!!!!!!!!!!!

That, suffolkmum, is often the way - I tried, for nearly a year, to keep my business ticking over. Didn't even consider bankruptcy until HMRC decided to push the blade in deeper - then 'twisted it'.

suffolkmum

Rog 2 , Still feel really uncomfortable thinking about it, and my dearest wish would be to pay all the debts, and be able to hold my head high again.
All I try to think about is future, and how in my new very sensible employed status, i can start to provide for three kids again.

diablobear

Reading your post brought it all back, I too was sitting in the back room with the door shut to customers, crying and tearing my hair out, desperatly trying to find a way out of it all. In my case I ended up liquidating the company and going personally BR due to HMRC, personally guaranteed loans & landlords lease. This was with the advice and support of debt charity helplines (both business and personal) along with a heck of lot of soul searching. It's not easy, it's one of the hardest things I ever had to do, but the first step I took was to get impartial advice and then the rest just followed on and seemed a whole lot clearer. The business was liquidated just under two years ago and I have been discharged from BR a few months back. The worst had happened after a long time of putting off the inevitable, but in the end, in my case it was the best thing I ever did.
I am so sorry you are going through this, my heart goes out to you - I really do know how it feels. Please contact the Businessdebtline or similar charity they are not there to profit from your problems and without whom I could never have got myself out of the situation I was in. Nearly two years on and I am rebuilding my life and moving forward, although not at lightspeed, but definatly not running around in circles anymore. It hasn't been easy and there are still hiccups along the way but there is light at the end of the tunnel, just take baby steps towards it and you will get there.

HTH and all the best x

fiveyearplan

suffolkmum wrote: »

my dearest wish would be to pay all the debts, and be able to hold my head high again.

Hold your head up high now! What have you done to be ashamed of? You tried a business and for whatever reason it wasn't working - these things happen. I just have to go to the High Street to see what business has closed down this week to reassure myself that I am not alone and I'm glad that part of this mess is over.

rog2

diablobear wrote: »

Reading your post brought it all back, I too was sitting in the back room with the door shut to customers, crying and tearing my hair out, desperatly trying to find a way out of it all.

It brings it all back to me, db - every time I see a post like this. I see very few posts where a small businessman/woman has ever just said 's0d it', turned off the lights, closed the door and just walked away from it.
The majority of those 'small' business people, at least those who find their way on to this board, have tried everything to 'keep their business afloat' and, and this is what I find the most admirable, to 'minimise the effect on either their employees or their suppliers.
All these 'efforts' invariably end up as fruitless when confronted by the totally uncaring and inflexible wall of beaurocracy that is HMRC, which appears to be ready to wait until the debtor is at their lowest ebb, both financially and morally, before pulling the rug.
Even that said, I do not 'wish' to generalise about HMRC, nor do I want to suggest, in any way, that HMRC may be populated by nasty little people who are trying to get their own back on anyone who shows a little initiative. Niether, and I mean this most sincerely (apologies to Hughie Green ), would I like to infer that the Tax/Vat man likes to demonstrate his 'power' by coming down like a ton of bricks on the small, and often defenceless, small business person, whilst conveniently 'turning a blind eye' to the huge 'multi-national' concerns who know how to succesfully play the system.
And, finally, I would never dream of inferring that HMRC would 'use' the more vulnerable cases in order to 'boost' their statistics in any way.

diablobear, suffolkmum and dingaling - you can, and indeed should, hold your heads up high - even at the last you were, and in dingaling's case still are, worrying more about how your situation was affecting others.

Indeed your creditors, including HMRC, would do well to take a leaf from your book.

fiveyearplan

Well said Rog.