Whether you want to rescue your business or close a company that’s run its course, if your business is experiencing financial issues - or if there is trouble on the horizon - you need the help of an insolvency practitioner. It can be difficult to know when to seek professional help.
Should you try and trade your way out of difficulty? Wait until your company needs to be liquidated? Or is it better to reach out to an insolvency expert sooner?
Read on to discover out top insolvency advice for directors and find out when you should make that call...
Get advice as early as possible
Whether you’re ready to close your company or not, the earlier you seek advice from an insolvency practitioner, the better. Unexpected cash flow issues or the sudden loss of customers are warning signs that should never be ignored - and it might be that seeking professional help early could help to ensure your business remains solvent.
Even if you plan to liquidate your business at a specific time in the future, timing the liquidation of your business could make a huge difference to you, your employees and your creditors.
There will be a number of different ways to achieve the outcomes you desire, depending on your personal circumstances and what you are looking to achieve - so by seeking insolvency advice for directors as soon as possible, you will be able to assess all your options and decide what to do moving forward.
Whether you are looking for help so that you can rescue your business or are planning ahead for liquidation, it’s never too early to seek advice. After all, taking action quickly could be the difference between a positive outcome and having to close your doors for good.
Don’t forget your duties as a director
As a company director, you have certain obligations to your creditors, staff, and shareholders - especially when your business is under threat. In these circumstances, as soon as you know your business is insolvent, you should always put the interest of your creditors first.
This might mean continuing to trade if it puts you in a better financial position, or it might mean liquidating the business as soon as possible. By consulting an insolvency practitioner, you’ll be able to carefully plan your next steps.
How an insolvency practitioner can help
Enlisting the help of an insolvency practitioner can guide you through this challenging time. Firstly, you will be able to protect yourself from any wrongful trading claims, whilst enlisting the help of an insolvency practitioner also allows you to demonstrate your commitment to prioritising your creditors.
Should you need to close down your company, they will be able to advise you on the best time to do so that works on both a personal level as well as ensuring maximum funds are available to your creditors.
What your insolvency practitioner will do
The sooner you seek advice from an insolvency practitioner, the sooner you will be able to explore the different options open to you and your company. Depending on your situation, your options might include:
1. Pre-Pack Administration
Close down and restart a company. This allows the Directors to purchase the goodwill and assets of the company to restart.
2. Creditors Voluntary Arrangement (CVA)
This allows you to protect a struggling business whilst a solution is found and repay creditors out of future profit.
3. Creditors Voluntary Liquidation (CVL)
If your company is insolvent, you can close the door and walk away: creditors will be dealt with, leases will be cancelled and all loose ends will be tied up.
4. Members Voluntary Liquidation (MVL)
Also known as Solvent Liquidation, this is when a company has money but has served its purpose and needs to close and distribute share value to directors in the most effective way.
How we can help
McAlister & Co are licensed insolvency practitioners who provide business and insolvency advice to Directors, Sole Traders, and Partnerships. Our experienced team can help you with all this and more:
- Deal with staff and unpaid wages
- Deal with your creditors
- Deal with bailiffs, solicitors, and court officials
- Safely close a company and restart
- Obtain the valuation of business assets
- Help protect your family home and personal assets
- Negotiate with HMRC on your behalf
Financial difficulty can be a very stressful time and can feel like an incredibly lonely place - but it doesn’t have to be this way. For FREE initial help and insolvency advice for directors, contact McAlister & Co today for a no-obligation consultation to discuss your situation. Our experienced team are always happy to help and advise.