Note: certain names and details have been changed to protect the privacy of the persons involved.
Mr Davis operated as a sole trader in the computer business. Through a number of bad debts, poor management and overspending, he had run up credit card and business debts. His business was operating well, but he was having difficulties meeting the certain of the old debts. Mr Davis knew that he was at risk from a bankruptcy petition, from HMRC but wanted to avoid bankruptcy because it would make it almost impossible for him to continue in business. He had minimal personal assets.
Mr Davis was referred to us and we examined his circumstances. It was certain that if no action was taken, then a bankruptcy petition would be presented with no prospect of paying the debts owed. On reviewing his on-going business, it showed every potential to generate a good income stream. We spoke to the most pressing creditors to determine what kind of settlement they would expect realistically and having been satisfied that Mr Davis would have the income stream to be able to pay these from future income, we arranged the payments to be made over sixty months in full and final settlement.
COMMENT
Mr Davis’s position is typical of many small business owners. He experienced bad debts and poor management in the initial stages of his business, after having stated a successful business.
However, the historical debts were too much for the business to deal with. By negotiation with the largest creditors and a proposal for
payment on a monthly basis, this was realisticfor his creditors to consider rather than instigating Bankruptcy proceedings.
Next Steps
If you want to find out anything further about this topic then please feel free to call on 0330 236 9930, 0330 236 9938 or 07961 116321. All conversations will be in strict confidence. You can also email vee@navigatebr.com
This article is for information and interest only. It is not a substitute for full professional advice, which will take in to account the specific and individual circumstances. Navigate Business Recovery Limited cannot accept any responsibility for any loss arising as a result of any person or organisation acting or refraining from acting on any information.
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