Another insolvency question

Discussion in 'Insolvency' started by Goingunder, Nov 7, 2018.

  1. Goingunder

    Goingunder UKBF Newcomer Free Member

    25 1
    Hi I'll spare the background but I currently owe:

    HMRC £5k VAT (last return late and not done)
    £4.5 PAYE
    £1.5k CT
    £2k to one supplier
    £2.5 to another
    £800 LTD company credit card

    I also am being chased for a parking fine in LTD company name for about £650 (bailiffs after it)

    I have DCA after all HMRC debts and they have been put on hold for 30 days.

    Also have DCA after one of the suppliers.

    I have spoken to two IPs and both have offered to help for around £5k. One wants 50% one wants £500 and the remainder over 12 months.

    The latter have said about redundancy pay and likely that will cover all her costs anyway.

    I'm not sure whether to do that or do this Spongebob method.

    I opened a new LTD company yesterday. I'm not sure if the name it too similar though.

    Say my name is James White. My current company is James White Ltd but trades unofficially under another name.

    My new name is Whites Autos Ltd.

    I also haven't had a personal bank account so I started one last night.

    I'm determined to put the poor business running behind me.

    I also very much may let the Ltd company lay dormant and trade as self employed.

    The company is just not going to come out of that debt as small as it may seem.

    I can make a small and steady living under a new aspect of business. It won't buy me a Ferarri but it will support us.

    Currently living with her parents but soon to rent a house.

    She is employed currently by my ltd company but doesn't need to be.



    Do I send the SB letter to all creditors or to the DCA or both?

    What about the council in regards the parking fine?

    What do I do? Stop trading now and trade under new Ltd company for a while?


    One IP said to sell assets to Newco at a reasonable rate. Apparently on my books my assets are £38.

    In terms of the LTd company the assets are very very few. £500 on a very very good day in tools as I hadn't realised m SnapOn is all in my personal name.

    Which leads me to another question.

    I've claimed the VAT back on tools that subsequently the invoices say that I personally own.

    Do I take them as owned by oldCO or have I done something claiming VAT back?

    If I do sell from old co to new co can I stick the cash in an envelope and keep it or do I need to put it in bank?

    Thanks guys
     
    Posted: Nov 7, 2018 By: Goingunder Member since: Nov 7, 2018
    #1
  2. UK Contractor Accountant

    UK Contractor Accountant UKBF Big Shot Full Member - Verified Business

    4,606 766
    Have the IP's mentioned anything about repaying your overdrawn Director Loan Account?

    The assumption being that the company is unable to pay its debts as the Director/Shareholder has taken the money out of the company as illegal dividends or did the company actually make trading losses?
     
    Posted: Nov 7, 2018 By: UK Contractor Accountant Member since: Sep 18, 2013
    #2
  3. Goingunder

    Goingunder UKBF Newcomer Free Member

    25 1
    This is the thing.

    I don't know 100% I've been knocked several times.

    I've got one bank account and have personally put cash/borrowed from a good friend to pay the employee.

    One mentioned DLA and said the good news is you don't have one.

    I've sold a couple of personal vehicles and put the money in the company account.
     
    Posted: Nov 7, 2018 By: Goingunder Member since: Nov 7, 2018
    #3
  4. UK Contractor Accountant

    UK Contractor Accountant UKBF Big Shot Full Member - Verified Business

    4,606 766
    Ah - you have an employee?

    They might be entitled to Redundancy Pay in which case the IP route is probably the best way to go.

    The assets (inc Snap on Tools) need to be valued and sold to new company - the value in the accounts is irrelevant. You use ebay values etc.
     
    Posted: Nov 7, 2018 By: UK Contractor Accountant Member since: Sep 18, 2013
    #4
  5. Goingunder

    Goingunder UKBF Newcomer Free Member

    25 1
    Only my wife which was for (unsuccessful) mortgage reasons.

    5 months so the IP said won't be any redundancy.

    Ok even though they are reciepted in my name?
     
    Posted: Nov 7, 2018 By: Goingunder Member since: Nov 7, 2018
    #5
  6. UK Contractor Accountant

    UK Contractor Accountant UKBF Big Shot Full Member - Verified Business

    4,606 766
    if the company paid for them and claimed vat then yes.

    They have probably been included as tools & plant in the company accounts anyway.
     
    Posted: Nov 7, 2018 By: UK Contractor Accountant Member since: Sep 18, 2013
    #6
  7. Lisa Thomas

    Lisa Thomas UKBF Enthusiast Free Member

    2,999 357
    You may have introduced the assets to the Company via a Director Loan Account. Best to check with the accountants as to ownership. as these may now belong to the Company.
     
    Posted: Nov 7, 2018 By: Lisa Thomas Member since: Apr 20, 2015
    #7
  8. Goingunder

    Goingunder UKBF Newcomer Free Member

    25 1
    To be honest looking at the paperwork the SnapOn man has put it in the wrong name by mistake.

    I use an alias (not registered trading name) and hes used that as in J W Vehicle Services Ltd where as it should be James White Ltd.

    So i assume it would be under the ltd company as thats where it should be.

    What is a reasonable price for tools and assets?

    Vans worth £500 and tools would make 500 job lot on ebay.

    Woukd 600 be a reasonable amount as a job lot?

    Do i need to phyisically put the money in the bank?

    Thank you very much gyys
     
    Posted: Nov 7, 2018 By: Goingunder Member since: Nov 7, 2018
    #8
  9. Goingunder

    Goingunder UKBF Newcomer Free Member

    25 1
    Hi guys.

    A week and a bit on and thought things were looking up but I think the final nail has come.

    I was really trying to stay afloat as my wife is planning on a mortgage application in 5 weeks and I need to keep her paid til it goes through but it looks like it might not happen.

    A customer who owes us a chuck of money has themselves gone insolvent.

    We do have one of their vehicles in lien but not sure if we can sell it or what.

    Anyway one bit of advice. I've received a county claim form from Optima legal services for £750 for companies House fines.


    What do I do? Pay it personally? Offer to pay X amount a month? Contest it? (Companies House took 4 months to give my accountant a code to get on with books. They say nothing received but my accountant has emails submitting and the automatic replies sent back).

    Not sure what to do and if it affects anything?
     
    Posted: Nov 18, 2018 By: Goingunder Member since: Nov 7, 2018
    #9
  10. Gavin Bates

    Gavin Bates UKBF Enthusiast Free Member

    608 119
    Hi

    Obviously I would say this but take advice from an IP on your duties if the company is insolvent. On the Ccj set up a payment plan.

    Hope this helps.

    Regards

    Gavin
     
    Posted: Nov 18, 2018 By: Gavin Bates Member since: May 9, 2016
    #10
  11. Goingunder

    Goingunder UKBF Newcomer Free Member

    25 1
    Thank you for your reply.

    Would that not put us in a position of a CVA and therefore unable to strike off?
     
    Posted: Nov 18, 2018 By: Goingunder Member since: Nov 7, 2018
    #11
  12. Gavin Bates

    Gavin Bates UKBF Enthusiast Free Member

    608 119
    Sorry if you are planning to do a strike off then don’t bother with a payment plan
     
    Posted: Nov 18, 2018 By: Gavin Bates Member since: May 9, 2016
    #12
  13. Lisa Thomas

    Lisa Thomas UKBF Enthusiast Free Member

    2,999 357
    I'm not sure a CVA would apply, but perhaps a CVL would. You need to take advice to explore the relevant options to the Company's circumstances.

    As Gavin has suggested you really do need to take advice from an IP.
     
    Posted: Nov 21, 2018 By: Lisa Thomas Member since: Apr 20, 2015
    #13
  14. Goingunder

    Goingunder UKBF Newcomer Free Member

    25 1
    Hi guys.

    Absolutely nothing good has happened and I seriously cannot find the money for an IP.

    I need to get this put to bed now. The Mrs has gone back self employed (she was only PAYE for a mortgage but we have to put that on hold for now). So I have no employees to worry about.

    Obviously the returns are due end of the month.

    If I completely ignore the lot of it they usually threaten to strike the company off. What happens if I just ignore it all and let that happen? Do HMRC still object?

    If that is not the best way do I just send that Spongebob letter to HMRC VAT and PAYE departments and all other creditors?

    Will HMRC continue with debt collectors til struck off?

    Cheers!
     
    Posted: Jan 14, 2019 By: Goingunder Member since: Nov 7, 2018
    #14
  15. Spongebob

    Spongebob UKBF Ace Free Member

    2,158 1,086
    When you say the returns are due at the end of the month what are you referring to?

    VAT return?
    Accounts?
    Confirmation Statement?

    If it is the Confirmation Statement which is due you could try simply ignoring it. You will receive notice from CH of their intention to strike off the company two months later.

    Ignore it.

    A couple of weeks after this deadline expires keep an eye on your company status on the CH website. In my recent experience it will suddenly one day read "Dissolved".

    Open a bottle and drink to old Spongebob!

    If the Confirmation Statement is due soon this process short-cuts the entire Spongebob Plan as outlined in the sticky thread at the top of the forum. You should cause the company to cease trading but there is no need to send out any letters just yet. Simply wait and see if Companies House follows their normal procedure of automatically dissolving companies which fail to submit the Confirmation Statement. The beauty is that creditors (including HMRC) are seemingly not alerted to the imminent dissolution of the company and therefore are unlikely to object to it.

    There is no requirement to wait 6 months after ceasing trading before applying to have the company struck off, and there is no onus on you to inform creditors of an application to have the company dissolved, as no such application is made!

    The debt collection process will continue until the company is dissolved. The normal tactics of avoiding all contact with agents and making sure that any assets are out of the reach of bailiffs should stall the process sufficiently to give time for the dissolution to take place.

    There are few more satisfying moments in life than showing a bailiff proof that the company he has been pursuing for months has been dissolved! :D
     
    Last edited: Jan 15, 2019
    Posted: Jan 15, 2019 By: Spongebob Member since: Dec 9, 2008
    #15
  16. Lisa Thomas

    Lisa Thomas UKBF Enthusiast Free Member

    2,999 357
    As I said before you need to take advice form an IP, which you should get for free.

    That does not necessarily mean paying them for an insolvency process, just at least taking professional advice.
     
    Posted: Jan 15, 2019 By: Lisa Thomas Member since: Apr 20, 2015
    #16
  17. Goingunder

    Goingunder UKBF Newcomer Free Member

    25 1
    Presuming you offer this could you PM a rough idea of cost, how to pay and when I can book in a phone call?

    Many thanks
     
    Posted: Jan 15, 2019 By: Goingunder Member since: Nov 7, 2018
    #17
  18. Lisa Thomas

    Lisa Thomas UKBF Enthusiast Free Member

    2,999 357
    Of course - I'm around all day today so call whenever is convenient. 01752 786800
     
    Posted: Jan 15, 2019 By: Lisa Thomas Member since: Apr 20, 2015
    #18
  19. Blaby Loyal

    Blaby Loyal UKBF Ace Full Member

    1,016 193
    Please be assured that if you can read and write you do not need to incur the costs of an insolvency practitioner to bring this to a legitimate conclusion.

    If you do decide to instruct then, for the love of the almighty creator, agree on a fixed fee.
     
    Posted: Jan 15, 2019 By: Blaby Loyal Member since: Jun 12, 2018
    #19
  20. Goingunder

    Goingunder UKBF Newcomer Free Member

    25 1
    Many many thanks Lisa for the phone conversation earlier, really recommend anyone who is struggling to phone for advice! Certainly who I will be turning to if I do need an IP.

    One quick question r.e Spongebob, do I HAVE to send letters to every creditor together?

    The reason I ask is I have a very pushy debt collector on one of my suppliers case and is threatening court proceedings but the solicitor did say if they get the letter they won't bother. Also have VAT man sending letters saying they are focusing on me now as part of a small percentage of companies not paying.

    The thinking being my wondering is if I keep quiet and don't do any returns and CH do strike it off and I sit quiet then no one will object?

    Or do I just send the letters and let CH crack on anyway? Or just send the letters to this solicitor and maybe VAT.

    Just hoping to avoid baliffs/HMRC agents at the inlaws where the company is registered!
     
    Posted: Jan 17, 2019 By: Goingunder Member since: Nov 7, 2018
    #20