£1 sale or IP

[Contractor25]

Hi,

I’m new to this forum and to this whole process so please bare with me…

I have a company with debts to HMRC, a BBL and a supplier.

There is money owed to the company but this is unlikely to be realised. This receipt (if received) would clear debts.

I have a TTP arrangement with HMRC.

Currently due to no cash flow the TTP snd BBL are being covered by a loan to the company.

I have been offered a purchase of the company and its debts for £1.

What are the reasons to not take this option

Any advice much appreciated

Thanks

 

[Mark T Jones]

Hi,

I’m new to this forum and to this whole process so please bare with me…

I have a company with debts to HMRC, a BBL and a supplier.

There is money owed to the company but this is unlikely to be realised. This receipt (if received) would clear debts.

I have a TTP arrangement with HMRC.

Currently due to no cash flow the TTP snd BBL are being covered by a loan to the company.

I have been offered a purchase of the company and its debts for £1.

What are the reasons to not take this option

Any advice much appreciated

Thanks

I'm assuming this "1 sale will cost you a few thousand up front.

Suggest you search the forum for threads about Atherton Corporate

 

[Contractor25]

I'm assuming this "1 sale will cost you a few thousand up front.

Suggest you search the forum for threads about Atherton Corporate

There is a fee yes.

 

[Newchodge]

There is a fee yes.

What do you think you will achieve by selling the company for £1?

 

[ChrisCallaghan]

Hi and welcome to UKBF.

The following is one of the threads @Mark T Jones referred to, and has a link to another thread in it. Both are worth a read to help you make an informed decision.

Not insolvent yet!

So you are suggesting an IP will do it all for free? No. We offered to speak to you for free about your options, which might have included how to dissolve the company if it cannot afford insolvency. If you want to pay AG to buy your shares then that's your prerogative. You will lose control...

www.ukbusinessforums.co.uk

If you do approach an IP, make sure that the subject of Directors Loans is thoroughly and comprehensively discussed prior to actioning any insolvency process.

Specifically, I reccomend preparing (not submitting) accounts to a recent date to get and accurate balance for any directors loan, and making sure an IP has clearly outlined how such will be treated if you go ahead with a liquidation.

 

[Contractor25]

What do you think you will achieve by selling the company for £1?

Good question. Selling on the companies debts

 

[Mark T Jones]

Good question. Selling on the companies debts

AKA shafting your creditors using a barely legal sham sale.

 

[Newchodge]

Good question. Selling on the companies debts

The company's debts remain the company's debts and cannot be sold without the agreement of the creditors.

What do you think the people buying the company will achieve?

 

[Elliot Green]

Good question. Selling on the companies debts

You can't sell on company debts. It is a total non starter without the Creditor agreeing to it. The debts therefore typically remain with the limited company.

These schemes - otherwise known as Insolvency Avoidance Schemes - are often ineffective and certain of them discredited. Directors therefore who look to use them may actually highlight themselves for more detailed investigation.

 

[UKSBD]

Dou you owe the company anything?
i.e.
took dividends when not really entitled, have a directors loan, extracted money/assets in any other way without it being declared?

 

[Contractor25]

No - I do not owe anything to the company - No Divs, DLA or asset stripping. Why?

 

[Elliot Green]

No - I do not owe anything to the company - No Divs, DLA or asset stripping. Why?

What's is the perceived benefit of the share sale as opposed to Liquidation?

 

[Bobbo]

No - I do not owe anything to the company - No Divs, DLA or asset stripping. Why?

One has to wonder where did the money go?

Why is this money owed to the company, which would cover everything, doubtful of recovery?

 

[Lisa Thomas]

I would steer clear of these types of 'schemes'.

You should take advice from a licensed insolvency practitioner, if your company is insolvent. .

Happy to speak to you about your options.