Help with closing a LTD company please

Discussion in 'Insolvency' started by purplesadpumpkin, Oct 31, 2020.

  1. purplesadpumpkin

    purplesadpumpkin UKBF Newcomer

    6 0
    Hi Everyone

    Sad to join on for such a crud reason but I don't see anyway out. :(

    I am sole director of limited company. We have about 250 in the bank account ( however with storage, website, qb fees won't last long) I am paying off a bookkeeper in installments so this should be covered in the above.

    There is a overdraft which was personally guaranteed by old director, not me as far as I know I have not signed anything. It is a business account so my name was swapped from hers on the account. The fees are extortionate so I'd rathe not use it and again it won't keep us going for the economy to recover and fear being in a worse position having that as a debt. At the moment I don't owe anything on the overdraft but will do if I can't sort quickly.

    Anyhoo

    I'm an ecom business so have assets like stock to sell ( currently costing me storage grumble) however due to Covid, brexit general economy I assume it's worth pittance even if Companies House says otherwise. It's something you buy when you go on holiday for women for the pool/beach. No travel, holidays, no money to burn means no sales. I have contacted a few jobbers but no replies even!

    Company owes a 3k bounceback loan via Barclays ( the one determined by year turnover) interest and repayments won't be due to start til next year if i understand correctly.

    Company owes me/ husband money we put in for stock as a directors loan (around 5k), we realise it's lost money sadly but cannot add more money in and tbh it would be lost too.

    Accountant ( no longer working 'for' the company) also put something in with Companies House regarding the personal 10k i used to buy the business. I was told this was to allow me to take the money out when company succeeded (not taken anything out apart from very low wages when company could afford it, no dividends/ loan repayment)

    Owe my parents on a 0% loan of roughly 2k left, I had been paying this back at a very small amount thet last few months when I could. Parent said willing to take in stock or to walk away if they have do but pride involved I want them not to lose money too.

    I am due to do CH and tax accounts up to may 2020, if I can navigate this myself then I save money for the company. obviously money that is currently not there. I shouldn't owe any tax from a rough workout ( sales decimated, what i sell is seasonal so covid struck right when I was just going to gear up)

    To further complicate matters I am due to go on maternity leave so obviously can't work short of KIT days. I have qualified for MA so won't have ay SMP coming out of the company which HMRC would pay company to pay me ( or vice versa). When I go on maternity leave I am shutting down ebay listings/ moving amazon to holiday/ putting website on the cheap hiatus plan on shopify, all to make sure customers not disappointed and to keep bills down when there's no money coming in. I'm running a sale right now to try and get some money for the company coffers but it's not going well.

    Bloody covid

    If you got through that you deserve a medal. I could cry in the corner, happy to help with more info

    Thank you
     
    Posted: Oct 31, 2020 By: purplesadpumpkin Member since: Oct 31, 2020
    #1
  2. Mr D

    Mr D UKBF Legend

    28,574 3,550
    Check out spongebob plan.

    Its not quick and its not stress free. But it works.
     
    Posted: Oct 31, 2020 By: Mr D Member since: Feb 12, 2017
    #2
  3. purplesadpumpkin

    purplesadpumpkin UKBF Newcomer

    6 0
    Thank you @Mr D

    I had seen it mentioned in other threads but no-one seemed to have assets/ stock to dispose of so I wasn't sure if it was just for companies that aren't retail etc. (or those who could sell their stock even at knock down price)

    Sadly no interest from jobbers etc. I'm gutted to shift it at a disgusting price (not that I can) but the company is incurring more and more storage fees. Yesterday's news means the unlikely sale is even more unlikely. Sadly jobbers have their pick of stock.

    Definately struggling to see a way out right now.
     
    Posted: Nov 1, 2020 By: purplesadpumpkin Member since: Oct 31, 2020
    #3
  4. Mr D

    Mr D UKBF Legend

    28,574 3,550
    Its for companies that basically cannot afford to close things down nice and simple.

    Lots of businesses - many perfectly viable ones last year - will be using it soon enough. Or have already started.
     
    Posted: Nov 1, 2020 By: Mr D Member since: Feb 12, 2017
    #4
  5. purplesadpumpkin

    purplesadpumpkin UKBF Newcomer

    6 0
    one positive bit of news, I've found shopify has added a new pause plan which will effectively close my website just has a message to say shop is closed temporarily and a message you put in ( I was going to put maternity leave but can put whatever I need to put). This lasts for 3 months with no fees After this it rolls to the reduced fee unless I properly close it. Thought that was pretty reasonable of them tbh. I thought my only option was I could pay reduced fees like I did in the first lockdown and have a live but basket disabled shop. Any bills I can cull means I can stay out ofthe overdraft longer.

    I do have a stupid question though? What do I do with the stock which is bulky but realistically worthless due to the current situation re. travel, leisure etc? Currently the company rents a storage room at 70 odd a month. Paid so stock can stay til early december, must I pull this out or just accept it will keep coming out of the account for the 3 months non trade? Assuming I have to keep the QB and bank account fees etc. until the bitter end. I could potentially transfer the storage unit to a personal one to hold the stock (I pay just for my convenience so I don't have to fall over it, we're running out of room anyhoo and baby isn't here yet!)
     
    Posted: Nov 1, 2020 By: purplesadpumpkin Member since: Oct 31, 2020
    #5
  6. purplesadpumpkin

    purplesadpumpkin UKBF Newcomer

    6 0
    @Spongebob @Mr D

    Sorry I feel a bit flummoxed...

    I do have a stupid question.

    What do I do with the stock which is bulky but realistically worthless due to the current situation re. travel, leisure etc? It has a good retail worth on paper but yea due to bloody covid it's worth nothing. Jobbers are well known for paying pittance so was always an absolute back up plan but I'm not even getting any replies sadly. (Spoilt for choice on stock I would assume :() Currently the company rents a storage room at 70 odd a month. Paid so stock can stay til early december before more monies due, must I pull this out or just accept it will keep coming out of the account for the 3 months non trade running risk of starting to be overdrawn? Assuming I have to keep the QB and bank account fees etc. until the bitter end so I have access to my figures etc. I could potentially transfer the storage unit to a personal one to hold the stock (we pay just simply for our convenience so we don't have to fall over it, we're running out of room anyhoo and baby isn't here yet!)

    My worry is that looks dodgy, I'm not trying to hide stock if that makes sense but can't afford the payments much longer ( without extortionate overdraft). Unsure where else to try and shift it! So if anyone has any ideas I'm all ears!

    As an aside would my 3 months non trade start from my last order (none currently in progress) or when say I shut the website down with a 'store closed'/ 'store closed due to maternity' message. I do still need to do my accounts/ tax return but I believe that comes under Director duties rather than trade. Oh and my maternity leave complicates matters. I haven't started it yet so hoping to clear as much as I can.

    Apologies if I've missed any steps/ flows to use
     
    Posted: Nov 2, 2020 By: purplesadpumpkin Member since: Oct 31, 2020
    #6
  7. Mr D

    Mr D UKBF Legend

    28,574 3,550
    Notify crown solicitor of this asset - they claim the assets when company dissolves.
    They can disclaim the assets in your favour. In which case get rid of them however.
    Or they can take the asset away .... If they think it's worth taking. From what you say... Perhaps not.
     
    Posted: Nov 2, 2020 By: Mr D Member since: Feb 12, 2017
    #7
  8. purplesadpumpkin

    purplesadpumpkin UKBF Newcomer

    6 0
    @Mr D

    Thank you, so I could pull them out (or take over the storage as a personal expense) as long as I told them of it's existence? As I said I'm not trying to hide them, just eek out the money in the account for as long as possible, to hopefully avoid overdraft fees/ extra debt. So the crown in an 'ideal world' go nah we don't want them so then I can get rid of them and the storage burden or they go oi no... we can sell them ... hand them over?

    Do I need to inform who I owe of the stocks existence in my template letters ( in this case me/my husband, my parents, and bank for bounceback loan), my sales have been utterly shite so on quick working out it shouldn't owe HMRC. obviously again being clear of the situation, anyone in theory should know that the stock being what it is means its pretty unsaleable right now. Outside of bloody covid stock should have been able to pay back my parents/ bank at least. We realise our monies that we have put in is long gone :'(
     
    Posted: Nov 2, 2020 By: purplesadpumpkin Member since: Oct 31, 2020
    #8
  9. Mr D

    Mr D UKBF Legend

    28,574 3,550
    You cannot prefer one creditor over another.
    May find no one wants the stock. Unless a matter of principle in which case cost does not matter.
     
    Posted: Nov 2, 2020 By: Mr D Member since: Feb 12, 2017
    #9
  10. purplesadpumpkin

    purplesadpumpkin UKBF Newcomer

    6 0
    Just about to send my notice/creditor letters as part of my Director duties :(. Last sale I had was in early November. I'm on maternity leave at the moment so can prove the no sales and my website is turned off etc. I'm just doing director duties right now.

    There's truly no way out which is very sad but I dare say I'm far from alone right now.

    Is there anything I need to do re. the bank and sending the creditor letter? It's a bounceback loan the company owes them ( repayments were due to start next year) and possibly/ probably a small overdraft (I'm still incurring fees from quickbooks, storage etc.) I asked for help with monthly bank account fees as the restrictions came back down again but no luck so those will still come out too. Trying to work out who it needs to actually be sent to at the bank.

    I have mentioned existence of the stock in my letters but that it's worthless due to covid and following covid economy ( template so appears in all creditors, no favouritism) and that I have contacted other retailers/jobbers/ dead stock resellers but no interest. Sadly I think they have their pick at the moment.

    Is it worth me doing my accounts and filing them with companies house? I have until May to file for up to May 2020. I have no money to pay so it would be using my director duties/ kit days to try and do it ( and hope I get it right). I will not owe HMRC as sales were absolutely decimated plus I'm seasonal so it got cut down just as sales were starting to come through.

    Interesting time to have a baby I can tell you. Muchos stress of all this on top of having a baby in a pandemic (she's very cute though :))
     
    Posted: Dec 29, 2020 By: purplesadpumpkin Member since: Oct 31, 2020
    #10
  11. Gavin Bates

    Gavin Bates UKBF Big Shot

    730 180
    hi

    given the circumstances, as you have mentioned I see no reason why not to try and file the accounts.

    best of luck

    gavin
     
    Posted: Dec 29, 2020 By: Gavin Bates Member since: May 9, 2016
    #11