Advice needed Today!
Discussion
I have a client who owes me £350. Its not much, but hes told me he will pay me before he closes the company down. He is closing down the company on Monday.
He's owed the money for a LONG time. If he is closing down the company, when its closed, there is no way of chasing after the money, right?
But if I get my solicitors to fire off a letter tomorrow, asking for payment before the company closes, then as a director he'll be obliged to deal with the money oweing. Right?
Im not entirely sure what the rules of play are, but IIRC you cant walk away from a LTD company as a director without tarnishing your 'name/record?' if money is oweing, correct?
Im asking, as my solicitors dont charge me to write letters to clients who owe money so its worth asking them to write him a letter, Im just not sure where I stand or whether he will feel obliged to pay once the company has closed down, so as not to tarnish his record (thats the bit im not sure about)
>> Edited by ukBOB on Thursday 30th June 17:56
He's owed the money for a LONG time. If he is closing down the company, when its closed, there is no way of chasing after the money, right?
But if I get my solicitors to fire off a letter tomorrow, asking for payment before the company closes, then as a director he'll be obliged to deal with the money oweing. Right?
Im not entirely sure what the rules of play are, but IIRC you cant walk away from a LTD company as a director without tarnishing your 'name/record?' if money is oweing, correct?
Im asking, as my solicitors dont charge me to write letters to clients who owe money so its worth asking them to write him a letter, Im just not sure where I stand or whether he will feel obliged to pay once the company has closed down, so as not to tarnish his record (thats the bit im not sure about)
>> Edited by ukBOB on Thursday 30th June 17:56
How is he closing the company down?
Liquidation?
Striking Off?
Ceasing to trade?
A striking off cannot procede if a creditor objects.
To be honest, in the bigger scheme of things, £350 is not a huge amount of money and it is unlikely that there is much you can do to enforce collection which not involve you in costs far greater than £350.
Liquidation?
Striking Off?
Ceasing to trade?
A striking off cannot procede if a creditor objects.
To be honest, in the bigger scheme of things, £350 is not a huge amount of money and it is unlikely that there is much you can do to enforce collection which not involve you in costs far greater than £350.
srebbe64 said:I could pick up the phone and in an hour generate 10 times that amount of new business, but I dont like letting debts slide either. As mentioned, my solicitors have an agreement where they write letters for me for free, Im just not sure how it works, re: him shutting down and going into hiding.
There's no easy way of saying this, but you can kiss goodbye to that money. Your only hope is to go there in person tomorrow and remind of his promise. Beyond that, the money's gone!
Can anyone further explain erics comments, re: companies cant close down with debtors objecting or asking for monies?
"Striking Off" is the simplest way a limited company can be permanently closed. Essentially, the Directors apply to Companies House for the company to be "Struck Off" the Register of Companies. Once that is done, all the debts and liabilities of that company die with the company.
However, before the company can be struck off, Companies House publishes a notice of the intended Striking Off in the London Gazette. People, businesses and government agencies (the tax authorities mainly)who are owed money by the company can then raise an objection to the Striking Off of the company on the grounds that they are owed money. Companies House will then halt the striking off process. Objections must be lodged within six months of the intended Striking Off appearing in the London Gazette. Once the six months period has elapsed with no objections raised, then the company ceases to exist.
Striking Off is a very popular method of closing a company down as it is virtually free to do.
Alternatively, a company can be liquidated, Usually, a Liquidator is appointed by the directors to "Wind Up" the company. Part of the liquidator's duties is to write to each and every creditor of the company to notify them that the company is being wound up and that, if they want any of their debt paid, they should confirm the balance outstanding and notify the lquidator by return. In liquidations, creditors are ranked with normal trade creditors coming very far down the list. Creditors are usually lucky to receive 10p for every £1 owed to them.
Creditors themselves can instigate liquidation procedures against a company if they feel they are getting no joy in their chasing of owed monies. In this case, the creditors convene a meeting and appoint a liquidator of their choosing. The liquidator then applies to the courts to have the errant company wound up.
However, before the company can be struck off, Companies House publishes a notice of the intended Striking Off in the London Gazette. People, businesses and government agencies (the tax authorities mainly)who are owed money by the company can then raise an objection to the Striking Off of the company on the grounds that they are owed money. Companies House will then halt the striking off process. Objections must be lodged within six months of the intended Striking Off appearing in the London Gazette. Once the six months period has elapsed with no objections raised, then the company ceases to exist.
Striking Off is a very popular method of closing a company down as it is virtually free to do.
Alternatively, a company can be liquidated, Usually, a Liquidator is appointed by the directors to "Wind Up" the company. Part of the liquidator's duties is to write to each and every creditor of the company to notify them that the company is being wound up and that, if they want any of their debt paid, they should confirm the balance outstanding and notify the lquidator by return. In liquidations, creditors are ranked with normal trade creditors coming very far down the list. Creditors are usually lucky to receive 10p for every £1 owed to them.
Creditors themselves can instigate liquidation procedures against a company if they feel they are getting no joy in their chasing of owed monies. In this case, the creditors convene a meeting and appoint a liquidator of their choosing. The liquidator then applies to the courts to have the errant company wound up.
I have had this a few times tried the legal way and only come up good once but cost me more hastle, now I go and pay a visit explaning to them very nicley that I could turn up at their house at any time asking for what they owe me especialy when they seem to have a few guest around, As ltd companies it is easy to get directors addresses or just follow them, I feel same in that the debt must be paid at what ever little it would be,Some one owed me £72.00 when I was in my second year trading was 8 months unpaid, I waited till I had a job in the area pulled up in my van got my gas bottles out and said who is the owner of this merc (was parked in the md spot
) Lit my flame and said very politely cheque please or the car gets it, you should have seen him move 
, 17 years on touch wood and only 2 have took me and I always get results on a personal visit 
Ste..
) Lit my flame and said very politely cheque please or the car gets it, you should have seen him move , 17 years on touch wood and only 2 have took me and I always get results on a personal visit Ste..
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