Tricky situation with deposit

Discussion in 'Insolvency' started by JuFoster, Dec 2, 2019.

  1. JuFoster

    JuFoster UKBF Newcomer Free Member

    8 0
    Need advice on a tricky situation.

    My property company looks like we're insolvent. We rent out real-estate.

    We are looking for advice on how to proceed.

    Creditors are:
    - Business rates: £35k (Backdated yearly bills for around 3 years for a property)
    - PAYE: £10k
    - A landlord £10k
    - We're also tied into a mega contract with a telecomms provider, worth around £15k if it can't be switch to the new property owners once we've left.

    The company has no assets as all of the agreements we have are short term lease agreements. Fittings inside the properties are virtually all property of the sub-tenants.
    We do have £30k tied up in a deposit on one property. - But how would we get this back, surely the LL will retain it once we start the insolvency process?

    Can anyone advise on what can be done with the business rates bills? Is it possible to retain any of the properties that we have with a new company going forward?

    Any help would be much appreciated.
     
    Posted: Dec 2, 2019 By: JuFoster Member since: Jul 17, 2012
    #1
  2. UK Contractor Accountant

    UK Contractor Accountant UKBF Big Shot Full Member - Verified Business

    4,973 864
    appeal if you have grounds - small business rate relief?

    yes - liquidator will assist transfer of business/undertaking.

    is this an investment in a property?
     
    Posted: Dec 2, 2019 By: UK Contractor Accountant Member since: Sep 18, 2013
    #2
  3. Lisa Thomas

    Lisa Thomas UKBF Enthusiast Free Member

    3,515 445
    The Liquidator will try to recover the deposit but the landlord might be entitled to some/all of it.

    Either way it won't really affect you personally if it is a Company asset.

    The rates arrears will be die through the Liquidation. Newco will be responsible for any new rates liabilities going forward.

    The Directors will need to take care not to breach any Phoenix legislation.

    Has the Newco taken over any of the assets/business of Oldco?

    The Directors should get proper advice form a licensed IP.
     
    Posted: Dec 2, 2019 By: Lisa Thomas Member since: Apr 20, 2015
    #3
  4. JuFoster

    JuFoster UKBF Newcomer Free Member

    8 0
    Small business rate relief doesn't apply. The reason we're in this situation is that we thought it would, but doesn't as the property was too big.

    The £30k is a deposit deed.

    Lisa - thanks I will send you an email.

    What things should I be aware for with Phoenix legislation?
     
    Posted: Dec 2, 2019 By: JuFoster Member since: Jul 17, 2012
    #4