What is Insolvency?

Insolvency can be a daunting prospect for most people, feeling like you are alone with nowhere to turn to for help. With Restart BTi, you are not alone.

What is insolvency?

Insolvency is the term used for when an individual or company can no longer meet their financial obligations to its creditors.. As described by the UK Government, this applies when a business cannot pay bills that are due, or has more liabilities than assets. When a company is insolvent, it is at risk of being closed down unless a turnaround is possible. With the help of an Insolvency Practitioner, you will be able to receive expert advice on the most appropriate next steps for you.

What is an Insolvency Practitioner?

An Insolvency Practitioner is someone who is licensed to take appointments in formal insolvency procedures . This means advising directors and individuals of the most appropriate procedure for their circumstances . All of these options for a business are complex legal procedures that will need specialist help.

How do I know if my business is insolvent?

It’s important to know the signs when your company is heading for trouble, and to receive expert advice, guidance and support if you are worried about the future of your business. insolvency is usually a last resort Before it gets to the point of insolvency, the typical warning signs can include:

1. More outgoings than income

As a Director, you should regularly review and monitor your cash position. This will ensure that your business can meet its liabilities. If you are unable to pay your creditors, you may be faced with legal action or a refusal for further credit.

Another indicator may be a constant reliance on extra finance like an overdraft or continuously missing or having to delay payments to creditors is another.

It’s vital to keep disputes to a minimum, and seek the guidance of a qualified Insolvency Practitioner if you’re worried about your finances.

2. Struggling with debts

Similarly, if you’re struggling to pay off your company debts, either in full or in the agreed payments, then this is a key indicator that your business is becoming insolvent. Legal action can be taken against you by your creditors if you are unable to pay off what you owe.

3. Loss of customers

markets are always changing, evolving, and growing. If your business is struggling to keep up with new trends, has become outdated, or is unable to adapt to new markets then you may experience a loss of market share. As a result, this may impact your turnover so that business can longer meet its overheads. Alternatively, a major customer may stop trading.

What are my options if my business is insolvent?

If you are worried about your business, or believe that your business is insolvent then your first priority should be to contact an Insolvency Practitioner that you can trust. From there, you will be provided with tailored advice and support to help you with this difficult matter. Usually, businesses that are struggling have 4 different options for recovery. This includes:

Formal discussions with all creditors to see if a payment agreement can be reached, such as extending deadlines or lower monthly payments.
Explore the option of a Company Voluntary Arrangement (CVA).
Rescue the business by going into administration.
Liquidating your company (closing down).

Of all the options available, the liquidation process of last resort but is the most common. This means that your business is formally wound down with assets being sold to pay off existing debts Your trusted Insolvency Practitioner here at Restart BTi will work with you to find the best solution for your business, and provide you with confidence and support along the way.

Administrations and CVAs are rescue procedures that will allow your business to continue to trade. Therefore , insolvency does not mean that your business has to close its doors forever. CVAs enable you to come to an agreement or settlement with your creditors, however, the terms will depend on your unique circumstances.

If you are able to continue trading, then it’s important that you take advice to avoid any personal liability This could include wrongful trading or a general breach of duty as a director. For more information, speak to one of our licensed Insolvency Practitioners at Restart BTi.

Help from the experts at Restart BTi

Here at Restart BTi, we understand that dealing with financial struggles within your business is a difficult and stressful time. Our Practitioners are on your side to help you figure out the best solution for your business, and resolve any financial issues as quickly and fairly as possible. To learn more about how we can help, simply fill in the Contact form below, and one of our reliable team members will be in touch.

enquiries@restartbti.co.uk

Suite 44, Dunston House, Dunston Road, Chesterfield, Derbyshire, S41 9QD

01246 959388

Gareth Graham Self is authorised to act as an insolvency practitioner in the UK by The Insolvency Practitioners Association under office holder number 9706.
Restart BTi is the trading name of Restart Business Turnaround Insolvency Limited, a limited company registered in England and Wales no: 11517419
Registered Office: Suite 42 Dunston House, Dunston Road, Chesterfield S41 9QD
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What is Insolvency?

Insolvency can be a daunting prospect for most people, feeling like you are alone with nowhere to turn to for help. With Restart BTi, you are not alone.