20+ Years Experience
Specialist Debt Advice
We are Struggling to Pay, a company offering company debt help who have assisted thousands of companies throughout the UK.
With specialists based throughout the UK we can offer competitive prices and in April 2024 are able to get costs to you very quickly.
Are you are struggling to make payments to creditors from your business in April 2024?
During the current pandemic, this is very common in the UK with business debts rising.
It can be a stressful time and you need to understand there are many solutions to help you during these hard times.
Britainâs economy is facing a lengthy recovery from the third coronavirus lockdown.
Business debt levels have risen in the UK massively after almost a year of economic turmoil caused by the pandemic.
British businesses took on debt at more than twice the normal average growth rate since the crisis began and are on course to have borrowed ÂŁ61bn in total by the end of 2021.
If you are wondering what to do if you cannot afford to run the payroll this month you should always try to make it a priority to ensure your staff are paid.
Not being able to pay your staff their wages on payday could spell disaster for your business. Without a workforce you could see operations rapidly grinding to a halt, preventing you from taking on any new work and struggling to fulfil current orders.
For the ongoing viability of your business, having staff you can rely upon to carry out the work required is vital. In order for you to be able to rely on them, they, in turn, must be able to rely on you to be a good employer, which includes fulfilling your duty of paying their wages in full and on time.
If struggling to pay wages there are some options on lending from bounceback loans, bridging loans or invoice factoring measures.
When your business is insolvent, you have a duty as a director to place the interest of its creditors above those of the company itself and to ensure you do not do anything which could worsen the position of your creditors. When you have failed to pay your employees, they become a creditor of the company and their welfare must be adequately safeguarded.
If you are struggling to pay your staff wages, you need to speak to an insolvency practitioner. Get in touch today and the IP will run through all possible solutions you have available (all calls are no obligation and completely confidential).
You can consider Time to Pay arrangement with HMRC (TTP) if you are unable to pay VAT.
HMRC may allow you to make outstanding VAT repayments through monthly instalments across a maximum of 12 months.
You will need to negotiate new payment terms with HMRC or run the risk of winding up your company if there is no viable repayment plan agreed with HMRC.
Yes, you can go to jail for not paying VAT with a possible prison sentence of up to 7 years.
It is a serious offence to intentionally evade paying VAT payments.
VAT evasion is a criminal offence under section 72(1) of the Value Added Tax Act 1994.
Charges can also be brought under the Fraud Act 2006 for not paying VAT.
If you are struggling to pay your self-assessment tax you need to speak to HMRC to arrange a time to pay agreement.
If you do not arrange a time to pay arrangement you’ll be charged penalties.
The penalties will be charged if you are one month late, then again at 6 months late and again if 12 months late.
HMRC charges 5% interest of the original amount you owe HMRC on penalties.
If you have received a County Court Judgement you should act quickly to pay.
Regardless of whether you think you shouldn’t pay you should act quickly on these debts.
If you canât pay the CCJ the parties you owe money to can pursue further action to recover what theyâre owed, such as sending in bailiffs or issuing a winding-up petition.
Creditors can send debt collectors, bailiffs, or High Court Enforcement Officers (HCEOs) for unpaid County Court Judgements.
Enquire today and see what a regulated insolvency practitioner might be able to do in stopping the bailiffs and debt collectors knocking on the door.
If your company is unable to pay back this emergency bounce back loan, it is not too much of a problem, if you have acted âreasonably and responsibly as a company directorâ.
Who knew what length of time the Covid crisis would last. If circumstances changed and you act properly there is nothing much to worry about. However, it is likely that if you do not pay back the bounceback loan then your credit rating may be affected at the bank.
What does not acting âreasonably and responsiblyâ mean. Well if you used the bounce back loan to repay yourself any loans that you introduced, or pay dividends or drawings when the company cannot pay normal suppliers or creditors, then this is called a preference and is actually against the law set out in the Insolvency Act 1986.
If businesses are unable to pay back their bounce back loan, then the declarations made at application stage will be reviewed by any insolvency practitioner and your actions carefully considered.
Upon applying, business owners were actually asked to formally declare that COVID-19 was the cause of the negative impact their business was facing and, that prior to 2020 the company, was âfinancially soundâ. If this information is found to be false, then again the director may be made personally liable for the loan, post liquidation.
If you know your business cannot pay rent, it is best to approach your landlord about business premises arrears, informing them of your current situation and try to reach an amicable agreement, potentially including a temporary suspension or reduction in rent.
Any agreement should be properly documented.
In essence, if your company cannot pay its debts as and when they are due, then it is insolvent. This means directors must look at and assess the options available to them.
Business credit cards are designed to help you finance entrepreneurship, though they do not shift responsibility from you to your company. In fact, most issuers embed a personal guarantee into the agreement that permits it to hold you liable for repayment of any debt you accrue with the card, even if all the charges were for your business.
If personal guarantees are applied to your business credit card agreement this will mean if you wind up your company then any debts on this business credit card would be transfered to your personal debts and could make you go into a personal IVA or debt management plan.
If you find yourself overwhelmed with business credit card debt try getting assistance from a professional. IP’s are here to help stressed-out borrowers. An IP can create a payment plan to help you stay on your feet while also paying your bills.
Business rates are essentially a tax imposed on properties which are used for commercial as opposed to residential purposes.
Business rates are enforced on a variety of units including retail units, warehouses, offices, bars and restaurants.
There are a number of business rate relief schemes which could help cut the amount you have to pay should you qualify for them.
Business rates are administered by local councils, and they have the power to implement a variety of measures on companies which fail to pay on time. This typically follows the following process:
If you are having problems paying your business rates, your first port of call should be getting in contact with your council. If you notify them of your inability to pay before you miss a payment, you stand a much better chance of being able to negotiate some form of plan with them going forwards.
Itâs important to note that if you can pay your tax bill, you should.
An HMRC Time to Pay arrangement is based on your income and expenditure and HMRC reserves the service for those in financial difficulty. Plus, because of the added interest, itâll end up costing you more to clear the debt in the long run.
If youâve considered this and still think you canât pay your tax bill, you should get in touch with HMRC as soon as possible.
Yes you can get HMRC debts written off through a debt solution such as an IVA.
However, the firm has to agree to this.
As a result, you should be in a position where the solution ultimately grants HMRC more money than they would otherwise have gained through bankruptcy.
If you do not pay your HMRC tax bill on time and cannot make an alternative arrangement to pay we strongly advise you speak to a business debt expert.
HM Revenue and Customs (HMRC) can take enforcement action to recover any tax you owe.
You can usually avoid enforcement action by contacting HMRC as soon as you know you’ve missed a tax payment or cannot pay on time.
Help and advice is available to give a manager director or financial director confidence in hat is the best business decision to deal with your current financial situation.
From vat issues, tax returns owed, HMRC tax arrears, cash flow problems to supplier debts then insolvency practitioners can offer feedback and advice to assist business owners.
The best thing you can do before repaying any creditors or making an arrangement to repay money owed is to seek advice from a business debt advisor.
A business debt advisor can talk you through all the various solutions available to make sure you can consolidate debts into an affordable payment plan.
If you feel the debts have soared out of control the business can no longer carry on trading the business debt advisor can also help wind up the company, liquidate the business or look at solutions to close your company.
But before making any decisions on the business debt solutions below we strongly advise you speak to a financial business expert who can assist with any questions you might have.
A CVL is also known as âinsolvent liquidationâ.
A Creditorsâ Voluntary Liquidation is a procedure which can be instigated by the director(s) of an insolvent company, where the shareholders of the company agree that the business should cease trading.
This is the form of liquidation, which is most commonly used in the UK.
When the directorsâ have resolved that the company should enter into CVL, all trading must cease and company assets will be sold in order to repay its liabilities.
Secured creditors with a fixed charge will generally take priority, followed by creditorsâ with a floating charge, and unsecured creditors.
A CVA is an option for a company which has a viable business but maybe facing financial strain.
A Company Voluntary Arrangement might be the best solution when receiving increased creditor pressure as a result of poor cash flow.
It is a form of composition (similar to an Individual Voluntary Arrangement), which will be overseen by a licensed Insolvency Practitioner (âIPâ).
The purpose of a Company Voluntary Arrangement is to provide the business with âbreathing spaceâ so that it can continue trading.
The company makes an affordable monthly contribution in relation to its existing business debts.
Monthly repayments are usually made for a period of 60 months, but the duration can be shorter if this is acceptable to the companyâs creditors.
A Compulsory Liquidation is a process to wind up an insolvent company through the courts. A Compulsory Liquidation is usually referred to as âWinding-Up Order”.
The S123 IA 1986 sets out the definition of Insolvency:- Creditor(s) are owed more than ÂŁ750 and have either served a 21-day demand which has not been met or judgment has been given or it is proved to the satisfaction of the Court that the company cannot pay its debts as they fall due or the companyâs liabilities exceed its assets including contingent liabilities.
Once the company has been wound up, creditors cannot bring action against the company except with the courtsâ permission. Creditors will be invited to send in details of their claims and if there are surplus funds after costs, unsecured creditors will participate equally for a dividend.
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An MVL is also referred to as âsolvent liquidationâ.
The Members Voluntary Liquidation procedure enables shareholdersâ to place a solvent company into liquidation in order to realise the assets of the business in order to distribute the surplus proceeds to the companyâs members.
The process is most often used to wind-down a company which has come to the end of its useful life.
A Members Voluntary Liquidation will only be suitable for a company which is solvent.
The statutory definition of âsolventâ is that the company is capable of paying its debts, in full, plus statutory interest, within 12 months of the date of the liquidation.
The administration is an option for a business facing financial strain or creditor pressure.
In many cases, a company which enters Administration can preserve the core business, and maintain continuity with its customers, and staff.
A company in Administration is legally protected from the commencement (or continuation) of any action against it.
This protection provides âbreathing spaceâ and gives the companyâs Board time to put together a plan of action which could include restructuring, assessment of cash-flow and future plans, or even marketing the business for sale.
Typically, a sale is agreed upon before the Administration. This is widely known as pre-pack administration and involves a sale to (all, or a number of) the existing directors operating a newly formed company.
In any case, a sale of the business must be viable and a buyer will need to demonstrate that the newly formed company has a good prospect of success.
Behind most success stories, there may be a previous failure or a very near failure.
We strongly advise you enquire to speak to a business debt experts today for a no-obligation call which will be strictly confidential.
Receiving debt advice is taking the steps to eliminate stress and anxiety on not knowing what solutions you might have.
The UK is a great place to start a business but it is incredibly competitive.
Entrepreneurship will always carry the risk of failure.
If your business is struggling with unmanageable debts, itâs vital you are able to work with a practice who will be honest about what is achievable and then hopefully exceed your expectations with their efforts.
The Insolvency Practitioners Association regulates our formal insolvency solutions.
Get in touch today and speak to a professional debt advisor on your solutions available.
Money advice services provide an overview of the services listed below:
Citizens Advice is an independent organisation specialising in confidential information and advice to assist people with legal, debt, consumer, housing and other problems in the UK. The purpose of citizens advice is to improve the policies and practices that affect people’s lives.
The citizens advice service provides free, independent, confidential and impartial advice to everyone on their rights and responsibilities, citizens advice get there funding to provide these services from the government. If you like in Northern Ireland you can reach out to Advice NI who can provide advice on personal debt and business debt.
The state pension age in the UK is 66 however this will be increased to 67 between 2026 and 2028.
After you have reached the state pension age you are able to start claiming some benefits however some of your other benefits may stop, however there are some benefits you can claim at any age as an adult so we always suggest researching and finding out what you need.Â
To qualify for a State Pension you need 39 qualifying years of National Insurance contributions to get the full amount, however you will still receive some if you have at least 10 qualifying years, but of course it will be less than the full amount.
Typically there are three main kinds of pension schemes these being workplace pensions, personal pensions and a state pension. With all three of these pension schemes, you make contributions into a pension fund during your working life. Pensions services allow you to enjoy a well earned rest after decades of hard work, so it is massively important you take the time to choose the right pension now to reap the rewards later.
Pension credit is additional money for pensioners to bring your weekly income to a minimum amount.
There are some apps you can download that will give you a free credit rating without impacting your credit score, the main one we would suggest is Experian.
Tax credits are credits that can be offset against a tax liability.
Universal credit is a payment to help with your livings costs, it is usually paid monthly or twice a month for some people in Scotland. You may be able to apply for Universal credit if your on a low income, out of work or you cannot work. If you are unsure if you fall into the low household income category it is ÂŁ17,100 per household before housing costs and ÂŁ14,800 after housing bills. With higher living costs Universal Credit is becoming a necessity for some homes, especially with the increases to council tax, energy prices and national insurance.
Social tariffs were created to help households in fuel poverty, you can apply for these tariffs if 10% or more of your income is eaten up by energy bills.
A discretionary housing payment is the money you receive from the council to help you with the following:
It is important to note that you do not have to pay a DHP back.
A charitable grant also known as a grant, it financial help given in the form of a grant to people in need. Grants are usually given as money, products and services that don’t have to be paid back at all.
Housing benefit also known as housing allowance is a group of social benefits aimed at reducing households hosing expenditure, this can be claimed from the local authority or local council.
Listed below are types of payment plan available:
There is usually two categories of mortgages available, fixed rate mortgages and variable rate mortgages. A fixed rate mortgage guarantees your rate for a set number of years, whereas with a variable rate mortgage your rate can go up or down depending on economic conditions.
A standard mortgage payment is usually made up of four components which include principal, interest, taxes and insurance.
If you miss a rent payment the money owed is known as “rent arrears”. Rent arrears are priority debts which mean the punishment for not dealing with them are very serious, some of these punishments include eviction.
Listed below are some of the essential bills in England or Wales:
Prepay meters are a type of domestic energy that requires its users to pay for energy before using it.
To cancel a direct debit with your bank just simply call the bank or building society.
It is quite commonly referred to as a payment holiday and it is an agreement with your lender to pause your mortgage, credit card or loan payments for a set period.
A personal loan is a type of loan that allows you to borrow a fixed amount money, which you usually pay back in monthly installment over a set period of time. Personal loans are typically a last resort as we would advise you to save money until you can afford the item you are taking the loan out for.
A budgeting load can be used to pay for essential or unexpected expenses if you’re on a low income. It can be used for a wide variety of things including, furniture or household equipment, clothing or footwear.
Missed or even late payments can often reduce your credit score a little, this massive downside of this is that it could take you beneath the lenders cut off point for approvals for things such as mortgages. Late payments can sometimes lead to a default or a County Court Judgement, these are likely to have a much more serious impact on your credit score.
There is 4 common payment plans, down payment plan, construction linked plan, time linked plan and flex payment plan. Each payment plans have their own advantages and disadvantages and we would suggest doing your own research before deciding on a final payment plans.
Make sure you contact us today for a number of great debt support services.
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