Protecting your business with expert advice
19th October 2021
This October has seen huge changes affecting business: the furlough scheme and suspension of winding up petitions both ended, hospitality and travel VAT rose to 12.5% and business rates relief ended back in June.
Despite Rishi Sunak’s announcement about £500m to renew job support programmes, it’s a testing time – particularly for small and medium sized enterprises (SME’s with less than 250 employees).
We talked to corporate recovery and restructuring lawyer, Alistair Bacon from AMB Law at Epsilon House, to get his take on the challenges facing many companies – and how to avoid liquidity and insolvency problems. Many businesses have shored up their finances using the government’s Bounce-Back Loan Scheme (BBLS) or Coronavirus Business Interruption Loan scheme (CBIL).
‘Rishi’s magic money-tree loans have to be repaid. Now is a good time for directors to take a step back and take a long, hard look at their company’s finances. Are you going to be able to cover your loan repayments in light of your anticipated cashflow over the next 12 to 24 months? Are you fulfilling all your legal duties as directors? Do you have customers who owe you substantial sums? Do you owe large sums to your suppliers or to HMRC?’
With 30 years’ experience in corporate recovery and restructuring, AMB Law advises a wide range of businesses on reducing risk of liability and navigating through troubled waters, particularly if insolvency looms. While companies can now claim from creditors, those same companies could face debts of their own.
‘UK plc has acquitted itself well through the pandemic, with government support and concessions from banks and landlords. The earlier that directors of companies take steps to address their financial situations, generally the more options will be available to them. This sort of analysis and decision-making cannot be left to the last minute as it’s far more challenging to assist the company and directors and avoid personal liability if the issue is left on the shelf too long.’