debts from a failed business and general advice

fiveyearplan

Sorry Geeka, I'm not sure what to do myself. I still haven't sorted through the paperwork from business debtline. I'll keep an eye on this thread and see if anyone has some advice.

Estherr

I'm bankrupt and my business debts were added to my personal debts - but I had signed personal guarantees for stuff. Good luck with it all.

fiveyearplan

Thank Estherr. I also signed personal guarantees.

geeka

i never signed any guarantees, the council tax is in the ltd company name. i dont think im liable but am not going bankrupt. what can i say to them? can they send baliffs to my house?

tigerfeet2006

Geeka give Business Debt line a ring and check with them. Number in my signature.

TangledMemories_2

I've got a failed business going through solicitors actions at the moment. My parents wanted to keep it all a secret and let me go under in silence (I'm lucky enough to have been signed up as a Director at the age of 18)..but I spilled the beans to my grandparents and thank god I did.

Now, I've got an excellent solicitor working in my favour and he's currently knocking seven bells out of RBS, RBS Invoice Finance and Iveco Finance.

All I want to say is, you're not alone but get some good sound legal advice to know where you stand.
Anything signed as a Director on behalf of a Limited company becomes a debt of the Limited Company.
Iveco finance made the fatal error of combining my sole trader name and the limited company name together in a contract.

Good luck!

fiveyearplan

geeka wrote: »

i never signed any guarantees, the council tax is in the ltd company name. i dont think im liable but am not going bankrupt. what can i say to them? can they send baliffs to my house?

Geeka - if you ring Business Debt Line come back and tell us what they say, esp about the business rates.

Walter_J

geeka wrote: »

it was an internet cafe and it has closed, i am about to wind up the ltd company and let companies house know. i need to look at the lease then and find out, even though i sent a letter giving my details it might not be valid.

How are you winding up the company?

If you appoint a liquidator, they are going to want paying - probably around £4000 for a simple job. If the business has closed and there are no assets then the liquidator will want paying in advance for his work. It doesn't sound like you have that kind of money available.

If you do nothing, then eventually a creditor such as HM Revenue and Customs will serve a winding up order on the company and the Official Receiver will handle the liquidation. My advice would be to write to all creditors of the company in your capacity as a director informing them that the company has ceased trading, has no assets, and cannot afford to appoint a liquidator.

You are not personally liable for any of the debts of the company. You will probably hear no more from most of the creditors - they have to write off debts like this every day.

Your only problem may be with your landlord. Although the lease was in the name of a limited company, most commercial landlords insist that directors sign a personal guarantee. Check this very carefully. If you have signed such a guarantee then you are personally liable to pay the arrears of the rent and to continue paying the rent for the remainder of the term of the lease.

If you find that you have signed a guarantee then the first thing to do is to give formal notice to the landlord of your intention to vacate the premises. This at least will cap your liability rather than leave it open-ended.

Unfortunately personal guarantees given by directors are probably the main cause of bankruptcies among business people. It happened to me.

geeka

right i'll send them a letter telling them what happened, are there an templates or shall i just put together a simple letter with the details you mentioned on?

thanks for you help.

fiveyearplan

Thanks WalterJ. I have very little debt associated with my Ltd. Utilities, £500 PAYE etc., nothing major. Do I write to them saying I'm no longer trading? I am going BR in the next 3 weeks (just got court papers for my Barclays overdraft so want to do it before the court date). What about the company secretary (my husband) who has no shares in the business? Should he resign or does it matter?