Limited Company and BR

skint_ecowarrior

Hi peeps,

I've been thinking about either BR or DMP for some time. CCCS are happy to manage a low start DMP starting at the end of this month.

However, business has been so poor of late, it looks like the company will become insolvent within the next four to six weeks or so and I'm beginning to come round to the fact that it may be better just to let it die.

My personal debts are about £28k (with no assets to speak of) plus £13k personally guaranteed business loan, so I think that BR may be my only available option. Can someone please advise what options there are for company directors who cannot afford an Insolvency Practitioner. I did hear that I simply resign as director once BR is finalised and Companies House will dissolve the business in due course.

Is that correct?

I've spoken to Business Debtline but there weren't too helpful.

Any advice would be much appreciated...

S-E

Richard_S

Hi S-E,

We were faced with the same dilemma when we were declared bankrupt. As an undischarged bankrupt you can't act as a company director so in theory anything you do has to be done before the date of your Bankruptcy Order.

You can apply for the company to be struck off, but only under certain circumstances:

Striking-Off, Dissolution and Restoration

How do I apply for a company to be struck off the Register?
Complete and send us Form 652A with a £10 filing fee: The Registrar will provide the form on request. However, striking-off is only applicable to a private company if, in the past three months, it has not:

• traded or otherwise carried on business;
• changed its name;
• disposed for value of property or rights that, immediately before ceasing to be in business or trade, it held for disposal or gain in the normal course of that business or trade; or
• engaged in any other activity except one necessary or expedient for making a striking-off application, settling the company’s affairs or meeting a statutory requirement. A company can, however, apply if it has settled trading or business debts in the previous three months.

(See guidance booklet 'Striking-off, Dissolution and Restoration' for full details of how to apply.)

How do I apply to restore a company to the Register?
A company may only be restored by a court order, so legal advice should be sought.

Who can apply?
A member or a creditor of the company, within 20 years of dissolution. If the company was dissolved following an application under section 652a, any of the parties who must be notified of the application may also apply. See guidance booklet 'Striking-off dissolution and restoration' for more information.

Where do I apply?
To the High Court, District Registry, or a County Court that has jurisdiction to wind up the company.

What are the costs?
The Registrar’s costs would normally be between £250 to £300, which have to be met by the applicant. Also there are solicitor's fees and court costs to be paid.

What is needed?
Before the court hearing the Registrar would normally ask for:

• the delivery of any statutory documents necessary to bring the company’s public file up to date; and
• the correction of any irregularities in the company’s structure.

A late filing penalty would also be payable by the company for each set of accounts delivered outside the period allowed by the Companies Act 1985.

For further details please telephone Dissolution / Restoration section (029 2038 0069 or 029 2038 0443).

The link to Companies House is:

http://www.companieshouse.gov.uk/infoAndGuide/faq/strikingOff.shtml

I think that you have to write to all creditors of the company and ask for their permission to have the company struck off, but it doesn't refer to that above. I'd ring the Companies House helpline and see what they suggest.

Regards

Richard