It’s true that when many people hear the words ‘business liquidation’ that they assume the worst. We think of failure and something coming to a bad end, but believe it or not, there are some positives to come from liquidating your company. The directors of the company will feel the benefits immediately, in that any debt collection that is ongoing must stop and the many calls from creditors demanding their pound of flesh can be controlled, and all these outside influences can be directed towards the liquidator. This then allows the directors of the business to make plans and release themselves from some of the stress involved.
It’s Not Personal.
It is important to remember that liquidation is not like insolvent trading. You are not permitted to continue on with your business if there is no chance that the creditors will be paid, and this is referred to as ‘wrongful trading.’ If any debts are incurred during this time, then the directors are liable and the directors need to make sure that they are not liable, so they don’t have to answer to the liquidator or the courts. The important thing to remember if you are a director of a company, is that this process is happening to the company and not to you personally.
If you decide to put your company into voluntary liquidation, then you are taking the responsible step. You are making sure that wrongful trading does not take place and that you are attempting to act in the best interests of the creditors. Once you go into voluntary liquidation, all the added stress and costs of all of this is avoided and this will allow you to move on and start looking at some new and exciting business opportunities. If the timing of the liquidation is done just right, then you can avoid any personal liability and you can maybe look at some other kind of business turnaround.
Get Professional Assistance.
In cases like these, it is always good to seek professional help for these matters. Talk to an accountant or solicitor who has a lot of experience in such things to help guide you along the way. Getting the right financial advice in the beginning will insure that you don’t make any silly decisions or mistakes later on. This is a difficult enough time, without you making it more difficult. In some cases only a certain part of the company is in difficulty and liquidating it, allows the company as a whole to do better. You can actually take your staff, machinery and your customers and begin again, all the while leaving behind all the debts previously incurred.
Reflect And Learn.
This liquidation is the perfect time to look at your business, your future career and the direction you want to be going in, from this point onwards. It is a time to reflect on what has taken place and an opportunity to learn from it, to make sure that it does not happen again. If you are going to liquidate, make the call early and get the right advice at that time.