Insolvency, Banruptcy and Closure
As an entrepreneur, there is always a risk that if you are unable to pay your debts, you may become bankrupt or insolvent. If you are a business, your creditors can seek repayment from you personally. If you are a limited company, your creditors cannot generally gain access to personal funds. However, your Company can be made the subject of Insolvency proceedings. Pro-Leagle offer advice on both Bankruptcy and Insolvency. Contact Pro-Leagle for more information.
- Bankruptcy proceedings differ to those of Insolvency proceedings. The former relates to individuals whilst the latter to Limited Companies.
- Both the Bankruptcy Procedure and the Insolvency Procedure follow a standard path.
- The effect of Bankruptcy is that you will be deprived of any assets that you own, including your house. Certain activities will be restricted, such as managing a Company or becoming a Director. Your debts will be repaid to creditors in an Order of Priority (Bankruptcy).
- The effect of Insolvency is that your Company's assets and goods will be collected and distributed amongst approved creditors. Distribution is also subject to an Order of Priority (Insolvency). The Company would then be dissolved.