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Does voluntary liquidation mean personal bankruptcy? Or is this at the corporate level (i.e. your Ltd company)? Who owes the debt - you or the company? HMRC deb
by charlesdm 11y ago
Does voluntary liquidation mean personal bankruptcy? Or is this at the corporate level (i.e. your Ltd company)? Who owes the debt - you or the company? HMRC debt might also be harder to get out of.
In general, corporate bankruptcy tends not to be a big problem. Personal bankruptcy, well, you become toxic to banks. It usually doesn't matter much to angel investors, but it can be a problem when trying to secure debt financing through traditional channels. It can however become a problem trying to secure personal stuff like credit cards or mortgages.
It's a good idea to talk to a lawyer about this.
- worriedinlondon 11y agoThanks for the advice. It's just the company that would be affected, I don't have any debts personally. Cheers!
- charlesdm 11y agoDo talk to a lawyer though. In some countries, under certain circumstances, there can be a shareholder liability for certain tax debts. Especially when you're using a personal service company. Good luck - hope you can fix this situation.
- charlesdm 11y agoAlso, and it depends on if there's a chance you might be personally liable, but if you intend to let the company go bankrupt, you might as well try and use that to negotiate the debt down (if that's at all possible). For example, let's say your debt is £50,000. If you declare bankruptcy, they get £0. Offer to pay them £15-25,000 - if they don't agree, declare bankruptcy, and they get nothing. Not sure if this will work with the tax authority, but I've heard this being used with private debt (bank loans) and it can work.