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How Long Does It Take To Liquidate A Company?

in Company Liquidation Guides

Liquidating a company can take anything from 14 days to 2 years. It depends on the size and complexity of the business and the particular type of liquidation process the company is undergoing. A creditors voluntary liquidation takes a shorter time, generally.

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How Long Does It Take To Liquidate A Company?

Can I claim Directors Redundancy in Liquidation?

When a company goes into administration or liquidation the directors of the business are in effect made redundant.  Their powers and duties as directors cease.  So, it isn't surprising to know that directors are in fact entitled to redundancy payments if they were employed by the company.  Given the company is insolvent then it cannot afford to make the payments, so instead the bill is picked up by the Redundancy Payments Office (RPO).  This fact can help alleviate some directors concerns about liquidation.  In any liquidation the employees are able to claim for arrears of Wages, accrued Holiday Pay and Pay in Lieu of Notice, and if they have been working for the same employer for two consecutive years are also entitled to receive a statutory Redundancy Payment.  The same applies to directors.  There are a number of companies out there claiming they can get large payments for directors but there are a number of caveats. What are the eligibility criteria? You must have been employed by the company and received a wage commensurate with your work. This is not often the case as directors usually pay themselves with dividends and take a minimum wage for tax reasons.  This was actually one of the reasons why many didn't benefit from furlough payments during the pandemic as they were not actually employees.You must have proof you were employed. Again just being paid via PAYE may not be enough.  You will need to show that you had a contract and that terms were set (these can be implied and not necessarily detailed in an employment contract) example terms might be holidays taken, sick leave, paternity.maternity payments, car allowances, pension provision etc.  ie all the usual things that an employee has.An employee may not work less than minimum wage. This is important as if you are putting in long hours and not being paid much then it actually means you are not an employee!  As such any claim will not be accepted. Small monthly payments will just be seen as extracting money from the company as an office holder not an employee. How do I apply? Once the company has gone into liquidation or administration then there is an application form that the directors can fill in.  It doesn't take long and there really isn't any need to employ a third party to do the claim for you.  Some companies are making some misleading claims about average payouts etc. How much am I likely to get paid? You will receive redundancy and loss of pay if you are entitled to it.  However, in most cases that we have dealt with the directors owe the company money and this negates any payout that is likely to be owed.  In addition, the Redundancy Payments Office (RPO) is getting very strict about claims, so a director that has taken out substantial dividends is unlikely to be regarded as an employee.

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Can I claim Directors Redundancy in Liquidation?

Why Directors Delay Getting Advice

There are many reasons why directors don’t act when they are worried about something. Here are a few possibilities: Avoidance: When you are worried about something, it can be tempting to avoid it altogether rather than confront it. Procrastination can be a way of putting off dealing with the problem or issue, in the hope that it will go away or resolve itself. Fear of failure: If you are worried about your business failing or not meeting expectations, you might put off taking advice because you are afraid of facing that failure. By not starting the task, you can avoid the possibility of failing and feeling bad about yourself. Being Overwhelmed: When directors are worried, they may feel overwhelmed by the task at hand. Procrastination can be a way of avoiding the feelings of stress or anxiety that come with tackling a difficult or complex task. Perfectionism: Some people may not take advice or delay doing so, because they have high standards for themselves and are worried about not being able to meet those standards. This can lead to a sense of paralysis, where they are unable to start the task because they are worried about not doing it perfectly. Overall, delaying action or not taking advice is a common coping mechanism for dealing with worry and stress. However, it often makes the problem worse in the long run, as the task or issue continues to loom and causes more stress and anxiety. It's important to recognize the reasons behind the business problems and work to address them in order to move forward and tackle the issue at hand. This is something we can help you do!  Call us on 0800 9700539  what have you got to lose!

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Why Directors Delay Getting Advice

What is the Enterprise Finance Guarantee Loan?

in Finance and Funding Guides

The Enterprise Finance Guarantee Loan (EFG) is a loan guarantee scheme to encourage further lending to viable SMEs, whom have been turned down for normal commercial loans due to lack of security or a proven track record. It allows these turned down companies to still borrow money from approved lenders.The lender must be satisfied with the businesses ability to repay the loan, to engage in such a scheme. It is up to them to confirm eligibility. They must believe that the business proposal and concept is workable, with growth and succeeding potential.It is up to them to confirm eligibility.  Almost all sectors are engaged in, as are most business purposes acceptable.Other eligibility factors are:Must be UK operating Turnover of no more than £41m Looking for finance between £25k and £1,200,000The government back the lender with a 75% guarantee against the outstanding facility balance – enabling a credit decision against a lender to be approved.Since 2009, when it launched, over 35,000 business loans have been provided with over £3.3bn of finance. In 2017, an extension to the scheme was launched, for a further four years, enabling us to guarantee up to £2bn lending over the period.Look out for companies who are EFG accredited lenders. Some are:Aldermore Finance Compass Finance Group Hitachi Capital (UK) NEL fund Managers Lloyds Bank Metro Bank Santander DSL Business FinanceFor more information on the EFG, see the gov.uk website here

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What is the Enterprise Finance Guarantee Loan?

Insolvency Toolkit for Directors

in Guides

Worried about your business? Concerned it may be failing? Need help fast but don't want to meet anybody face to face yet? Get all of our best guides and expert advice on one USB Drive FREE! This toolkit is available as a discreet USB device ( we do not mention insolvency on the drive itself ). You do not need to be connected to the internet to read all the guides to your options. What does it cover? The tests for insolvency Establishing if your business is viable. How to ask for time to pay your debts to HMRC Extensive guides on pre pack administrations, liquidation, company voluntary arrangements. A guide to all the legal actions that creditors might take and the issue of personal liability. What is an overdrawn directors account and why does it matter. How to raise finance to ease cashflow pressure. Your duties as a director of an insolvent company. Just plug in the drive and you can easily navigate to all the menus. The USB drive also includes Dissolution programme with all the letter templates and resolutions. A time to pay programme with all the letters and information needed to ask HMRC for more time to pay VAT/PAYE Daily cashflow spreadsheet to help you budget. Order your free toolkit and start taking action to save your business now. Please email robertm@ksagroup.co.uk to receive your complementary copy in the post. You can also request our FREE 80-page guide for worried directors here. We answer any questions you may have and provide detailed explanations on several insolvency issues.  

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Insolvency Toolkit for Directors