Bounce back loan options
Discussion
Hello Everyone.
I was talking to a friend last night who mentioned I might be able to get some advice from members in a similar situation on here, I wont name him unless he comments.
I am the director of a limited company and have been since 2012, as with most companies COVID was an odd time. We took out a BBL for 50k and it helped up increase stock amounts which paid off and we increased profits temporarily however we are now struggling.
One reason is the products we sell are higher end hobby/sport products so I think as people are feeling the pinch now there not splashing out or upgrading there current product and secondly is we are struggling to get stock, our suppliers have had tons of products on back order for most of 2021 and 2022 isn't looking good either, sales are plodding along but we cant stock the products people want/need yet we still have all our overheads so its affecting the balance sheet paying out all the usual overheads but not having stock to sell. Also to top it off Brexit was a ballache too and we lost one of our good suppliers last year due to that.
We have done what we can in regards to outgoings, minimised everything and paid some things off which has saved us a few hundred per month.
The BBL is being paid off too as planned and we could probably make some over payments but I would like to know if anyone has had to shut down there business with a BBL and how it affected you if it simply cant be paid off.
This is a genuine case where we might not be able to pay it off but were a long term business, were making the payments and if any searches are carried out the accounts clearly show a big drop in sales so its not like were trying to take the money and run here (like I know a lot of people did!)
We should be 'okay' for 2022 but its things dont pick up by the summer/autumn then we need to start planning seriously as 2023 wont be possible as at the moment were covering overheads plus a small amount but its not enough, especially considering the hours and stress were putting in to it for minimal salary at the moment.
Any info would be appreciated.
I was talking to a friend last night who mentioned I might be able to get some advice from members in a similar situation on here, I wont name him unless he comments.
I am the director of a limited company and have been since 2012, as with most companies COVID was an odd time. We took out a BBL for 50k and it helped up increase stock amounts which paid off and we increased profits temporarily however we are now struggling.
One reason is the products we sell are higher end hobby/sport products so I think as people are feeling the pinch now there not splashing out or upgrading there current product and secondly is we are struggling to get stock, our suppliers have had tons of products on back order for most of 2021 and 2022 isn't looking good either, sales are plodding along but we cant stock the products people want/need yet we still have all our overheads so its affecting the balance sheet paying out all the usual overheads but not having stock to sell. Also to top it off Brexit was a ballache too and we lost one of our good suppliers last year due to that.
We have done what we can in regards to outgoings, minimised everything and paid some things off which has saved us a few hundred per month.
The BBL is being paid off too as planned and we could probably make some over payments but I would like to know if anyone has had to shut down there business with a BBL and how it affected you if it simply cant be paid off.
This is a genuine case where we might not be able to pay it off but were a long term business, were making the payments and if any searches are carried out the accounts clearly show a big drop in sales so its not like were trying to take the money and run here (like I know a lot of people did!)
We should be 'okay' for 2022 but its things dont pick up by the summer/autumn then we need to start planning seriously as 2023 wont be possible as at the moment were covering overheads plus a small amount but its not enough, especially considering the hours and stress were putting in to it for minimal salary at the moment.
Any info would be appreciated.
A supplier of ours is in a similar position to your post, it puts me in a difficult position because although they are struggling for work, they are very important to us but we'll never be able to give them enough work that they could survive on. I say this as I have spoken at length with them and I have a passing understanding of the situation. I'm also using what they learned.
The first question the Insolvency guy asked was if anything on the form had been either fabricated or exaggerated because that might become an issue but aside from that and the fact you'll sadly lose your livelihood, it was relatively straightforward so long as the loan was properly used for more or less the intended purpose.
Google the Insolvency service and you'll see they are really only appear to come down on the scammers, set new co up, transfer money out to friends, buy Rolex, liquidate business.
This Pandemic has been horrible for my business and to be fair the Job retention scheme really helped us but we are a shadow of the business we were for no other reason than making parts for Vent systems used in Offices, requires office refurbs.
I'd review the application and make sure there is no queries on that.
As I say putting all that aside, you shouldn't miss the point that by the sound of it, you will be the real loser as the business I guess is your livelihood.
The first question the Insolvency guy asked was if anything on the form had been either fabricated or exaggerated because that might become an issue but aside from that and the fact you'll sadly lose your livelihood, it was relatively straightforward so long as the loan was properly used for more or less the intended purpose.
Google the Insolvency service and you'll see they are really only appear to come down on the scammers, set new co up, transfer money out to friends, buy Rolex, liquidate business.
This Pandemic has been horrible for my business and to be fair the Job retention scheme really helped us but we are a shadow of the business we were for no other reason than making parts for Vent systems used in Offices, requires office refurbs.
I'd review the application and make sure there is no queries on that.
As I say putting all that aside, you shouldn't miss the point that by the sound of it, you will be the real loser as the business I guess is your livelihood.
Moore517 said:
Hello Everyone.
I was talking to a friend last night who mentioned I might be able to get some advice from members in a similar situation on here, I wont name him unless he comments.
I am the director of a limited company and have been since 2012, as with most companies COVID was an odd time. We took out a BBL for 50k and it helped up increase stock amounts which paid off and we increased profits temporarily however we are now struggling.
One reason is the products we sell are higher end hobby/sport products so I think as people are feeling the pinch now there not splashing out or upgrading there current product and secondly is we are struggling to get stock, our suppliers have had tons of products on back order for most of 2021 and 2022 isn't looking good either, sales are plodding along but we cant stock the products people want/need yet we still have all our overheads so its affecting the balance sheet paying out all the usual overheads but not having stock to sell. Also to top it off Brexit was a ballache too and we lost one of our good suppliers last year due to that.
We have done what we can in regards to outgoings, minimised everything and paid some things off which has saved us a few hundred per month.
The BBL is being paid off too as planned and we could probably make some over payments but I would like to know if anyone has had to shut down there business with a BBL and how it affected you if it simply cant be paid off.
This is a genuine case where we might not be able to pay it off but were a long term business, were making the payments and if any searches are carried out the accounts clearly show a big drop in sales so its not like were trying to take the money and run here (like I know a lot of people did!)
We should be 'okay' for 2022 but its things dont pick up by the summer/autumn then we need to start planning seriously as 2023 wont be possible as at the moment were covering overheads plus a small amount but its not enough, especially considering the hours and stress were putting in to it for minimal salary at the moment.
Any info would be appreciated.
I take it you / any director hasnt been taking dividends since you got the BBL?I was talking to a friend last night who mentioned I might be able to get some advice from members in a similar situation on here, I wont name him unless he comments.
I am the director of a limited company and have been since 2012, as with most companies COVID was an odd time. We took out a BBL for 50k and it helped up increase stock amounts which paid off and we increased profits temporarily however we are now struggling.
One reason is the products we sell are higher end hobby/sport products so I think as people are feeling the pinch now there not splashing out or upgrading there current product and secondly is we are struggling to get stock, our suppliers have had tons of products on back order for most of 2021 and 2022 isn't looking good either, sales are plodding along but we cant stock the products people want/need yet we still have all our overheads so its affecting the balance sheet paying out all the usual overheads but not having stock to sell. Also to top it off Brexit was a ballache too and we lost one of our good suppliers last year due to that.
We have done what we can in regards to outgoings, minimised everything and paid some things off which has saved us a few hundred per month.
The BBL is being paid off too as planned and we could probably make some over payments but I would like to know if anyone has had to shut down there business with a BBL and how it affected you if it simply cant be paid off.
This is a genuine case where we might not be able to pay it off but were a long term business, were making the payments and if any searches are carried out the accounts clearly show a big drop in sales so its not like were trying to take the money and run here (like I know a lot of people did!)
We should be 'okay' for 2022 but its things dont pick up by the summer/autumn then we need to start planning seriously as 2023 wont be possible as at the moment were covering overheads plus a small amount but its not enough, especially considering the hours and stress were putting in to it for minimal salary at the moment.
Any info would be appreciated.
Thanks everyone, its quite a s
t time. The business has been really steady over the years, we have always made a profit and increased each year. The initial covid lockdown didn't really affect us, in fact with the 50k BBL we used it correctly and generated an extra 35k gross profit from this money initially but after that our suppliers were restricted and we have then basically been living off retained profits. We are still making money each month, some times its just enough to cover all outgoing and other months its not enough which is why he retained profits are declining.
I am still taking a wage and dividends but they are less than that have been for years so I am not taking the mick with it, I have to live so need paying regardless.
If our suppliers come through and we get a break then we should be okay but as the money declines in the company account the knock on effect is we then cant place orders large enough to get a break, its a bad circle to be in and I feel like we are just biding our time until the inevitable.
If it continues I need to look at how I can walk away from this with as much as possible, some people might not agree with it but for the last 10 years we have made good money, paid all taxes, VAT bills etc etc without a problem. I have a young family to provide for among other things so washing my hands and walking away without a penny isn't really an option, I need to keep it legal but I also need to protect my self for now.
We invested in a few properties over the years, they provide us some security thank god but its not a long term thing where I can live off them.
Frustrating as I know guys who are contractors or similar who took out BBL's for the fun of it, there the guys now driving round in RS6's, wearing Rolexes and having flash holidays as its was like free money for them. The legitimate people who have been honest throughout are the people like me worrying.
The only outgoing we have in regards to loans/credit is the BBL so its fairly easy to shut the business but if we do that will we then have Barclays chasing us for the money? we do have stock at value which would cover the loan to be honest but like I said I need to protect myself here, for the bank its a drop the ocean which will get rectified, for me its the difference in keeping my family going for months to come until we plan our next move.
t time. The business has been really steady over the years, we have always made a profit and increased each year. The initial covid lockdown didn't really affect us, in fact with the 50k BBL we used it correctly and generated an extra 35k gross profit from this money initially but after that our suppliers were restricted and we have then basically been living off retained profits. We are still making money each month, some times its just enough to cover all outgoing and other months its not enough which is why he retained profits are declining.I am still taking a wage and dividends but they are less than that have been for years so I am not taking the mick with it, I have to live so need paying regardless.
If our suppliers come through and we get a break then we should be okay but as the money declines in the company account the knock on effect is we then cant place orders large enough to get a break, its a bad circle to be in and I feel like we are just biding our time until the inevitable.
If it continues I need to look at how I can walk away from this with as much as possible, some people might not agree with it but for the last 10 years we have made good money, paid all taxes, VAT bills etc etc without a problem. I have a young family to provide for among other things so washing my hands and walking away without a penny isn't really an option, I need to keep it legal but I also need to protect my self for now.
We invested in a few properties over the years, they provide us some security thank god but its not a long term thing where I can live off them.
Frustrating as I know guys who are contractors or similar who took out BBL's for the fun of it, there the guys now driving round in RS6's, wearing Rolexes and having flash holidays as its was like free money for them. The legitimate people who have been honest throughout are the people like me worrying.
The only outgoing we have in regards to loans/credit is the BBL so its fairly easy to shut the business but if we do that will we then have Barclays chasing us for the money? we do have stock at value which would cover the loan to be honest but like I said I need to protect myself here, for the bank its a drop the ocean which will get rectified, for me its the difference in keeping my family going for months to come until we plan our next move.
Moore517 said:
Thanks everyone, its quite a st time. The business has been really steady over the years, we have always made a profit and increased each year. The initial covid lockdown didn't really affect us, in fact with the 50k BBL we used it correctly and generated an extra 35k gross profit from this money initially but after that our suppliers were restricted and we have then basically been living off retained profits. We are still making money each month, some times its just enough to cover all outgoing and other months its not enough which is why he retained profits are declining.
I am still taking a wage and dividends but they are less than that have been for years so I am not taking the mick with it, I have to live so need paying regardless.
If our suppliers come through and we get a break then we should be okay but as the money declines in the company account the knock on effect is we then cant place orders large enough to get a break, its a bad circle to be in and I feel like we are just biding our time until the inevitable.
If it continues I need to look at how I can walk away from this with as much as possible, some people might not agree with it but for the last 10 years we have made good money, paid all taxes, VAT bills etc etc without a problem. I have a young family to provide for among other things so washing my hands and walking away without a penny isn't really an option, I need to keep it legal but I also need to protect my self for now.
We invested in a few properties over the years, they provide us some security thank god but its not a long term thing where I can live off them.
Frustrating as I know guys who are contractors or similar who took out BBL's for the fun of it, there the guys now driving round in RS6's, wearing Rolexes and having flash holidays as its was like free money for them. The legitimate people who have been honest throughout are the people like me worrying.
The only outgoing we have in regards to loans/credit is the BBL so its fairly easy to shut the business but if we do that will we then have Barclays chasing us for the money? we do have stock at value which would cover the loan to be honest but like I said I need to protect myself here, for the bank its a drop the ocean which will get rectified, for me its the difference in keeping my family going for months to come until we plan our next move.
I'd take professional advice RE: the dividends. I'd a conversation with my accountant and he seemed to think the liquidator would be looking for dividend payments and may try to recover those against the BBL.t time. The business has been really steady over the years, we have always made a profit and increased each year. The initial covid lockdown didn't really affect us, in fact with the 50k BBL we used it correctly and generated an extra 35k gross profit from this money initially but after that our suppliers were restricted and we have then basically been living off retained profits. We are still making money each month, some times its just enough to cover all outgoing and other months its not enough which is why he retained profits are declining.I am still taking a wage and dividends but they are less than that have been for years so I am not taking the mick with it, I have to live so need paying regardless.
If our suppliers come through and we get a break then we should be okay but as the money declines in the company account the knock on effect is we then cant place orders large enough to get a break, its a bad circle to be in and I feel like we are just biding our time until the inevitable.
If it continues I need to look at how I can walk away from this with as much as possible, some people might not agree with it but for the last 10 years we have made good money, paid all taxes, VAT bills etc etc without a problem. I have a young family to provide for among other things so washing my hands and walking away without a penny isn't really an option, I need to keep it legal but I also need to protect my self for now.
We invested in a few properties over the years, they provide us some security thank god but its not a long term thing where I can live off them.
Frustrating as I know guys who are contractors or similar who took out BBL's for the fun of it, there the guys now driving round in RS6's, wearing Rolexes and having flash holidays as its was like free money for them. The legitimate people who have been honest throughout are the people like me worrying.
The only outgoing we have in regards to loans/credit is the BBL so its fairly easy to shut the business but if we do that will we then have Barclays chasing us for the money? we do have stock at value which would cover the loan to be honest but like I said I need to protect myself here, for the bank its a drop the ocean which will get rectified, for me its the difference in keeping my family going for months to come until we plan our next move.
Moore517 said:
so its not like were trying to take the money and run here (like I know a lot of people did).
Moore517 said:
we do have stock at value which would cover the loan
You're not taking the money and running, but you are using the money to buy stock which you are then thinking about selling and taking the proceeds and... running?If the business is insolvent or likely to become so you should sell the stock, pay back the loan and then maybe sell some of your property investments to keep yourself going while you plan your next move.
As others have said, if you have been paying dividends while insolvent that will cause problems when winding up if you can't repay your creditors, but it sounds like you are still solvent so may be worth stopping the dividends (and increasing your wages, if you have to) before you become insolvent.
If the business isn't viable long term I would imagine it's much less stressful to wind it up cleanly while you can rather than stressing about the legalities of how/if you can get as much money out without paying back tax payer funded loans.
If you are considering liquidation then I'd strongly suggest you sell your stock, pay back what you can on the loan and then place the company in liquidation if you have further debts.
Based on an experience of a close relative who put their shared business into liquidation (he owned approx 20%), the liquidator kept every single penny of nearly 50k (based on hours/timesheets etc) and didn't pay off a single debt (total of 85k). My relative now struggles to get insurance as they bring up this liquidation, the bank refused to give him a loan on his other very successful business (despite no bank having been affected) and there might be other issues somewhat. I mention all this because it may be far better for your life if you can avoid any sort of liquidation process, even if it costs.
Based on an experience of a close relative who put their shared business into liquidation (he owned approx 20%), the liquidator kept every single penny of nearly 50k (based on hours/timesheets etc) and didn't pay off a single debt (total of 85k). My relative now struggles to get insurance as they bring up this liquidation, the bank refused to give him a loan on his other very successful business (despite no bank having been affected) and there might be other issues somewhat. I mention all this because it may be far better for your life if you can avoid any sort of liquidation process, even if it costs.
Im sat at woking taking £800 ish a month since covid hit
Just about breaking even
We took a 50k loan, no dividends have been paid, as we are not making anything!
You sound a lot better of than me, if you close whats the plan? empty the bank account?
Just about breaking even
We took a 50k loan, no dividends have been paid, as we are not making anything!
You sound a lot better of than me, if you close whats the plan? empty the bank account?
Edited by t400ble on Tuesday 8th February 22:00
zedstar said:
Based on an experience of a close relative who put their shared business into liquidation (he owned approx 20%), the liquidator kept every single penny of nearly 50k (based on hours/timesheets etc) and didn't pay off a single debt (total of 85k).
Nearly always the way. If it’s looking like there’s any cash left they’ll write a few letters, the fees from which will soak up anything that’s left. Dr Interceptor said:
zedstar said:
Based on an experience of a close relative who put their shared business into liquidation (he owned approx 20%), the liquidator kept every single penny of nearly 50k (based on hours/timesheets etc) and didn't pay off a single debt (total of 85k).
Nearly always the way. If it’s looking like there’s any cash left they’ll write a few letters, the fees from which will soak up anything that’s left. 
Liquidators do well for themselves.Moore517 said:
Thanks everyone, its quite a st time. The business has been really steady over the years, we have always made a profit and increased each year. The initial covid lockdown didn't really affect us, in fact with the 50k BBL we used it correctly and generated an extra 35k gross profit from this money initially but after that our suppliers were restricted and we have then basically been living off retained profits. We are still making money each month, some times its just enough to cover all outgoing and other months its not enough which is why he retained profits are declining.
I am still taking a wage and dividends but they are less than that have been for years so I am not taking the mick with it, I have to live so need paying regardless.
If our suppliers come through and we get a break then we should be okay but as the money declines in the company account the knock on effect is we then cant place orders large enough to get a break, its a bad circle to be in and I feel like we are just biding our time until the inevitable.
If it continues I need to look at how I can walk away from this with as much as possible, some people might not agree with it but for the last 10 years we have made good money, paid all taxes, VAT bills etc etc without a problem. I have a young family to provide for among other things so washing my hands and walking away without a penny isn't really an option, I need to keep it legal but I also need to protect my self for now.
We invested in a few properties over the years, they provide us some security thank god but its not a long term thing where I can live off them.
Frustrating as I know guys who are contractors or similar who took out BBL's for the fun of it, there the guys now driving round in RS6's, wearing Rolexes and having flash holidays as its was like free money for them. The legitimate people who have been honest throughout are the people like me worrying.
The only outgoing we have in regards to loans/credit is the BBL so its fairly easy to shut the business but if we do that will we then have Barclays chasing us for the money? we do have stock at value which would cover the loan to be honest but like I said I need to protect myself here, for the bank its a drop the ocean which will get rectified, for me its the difference in keeping my family going for months to come until we plan our next move.
The stock belongs to the LTD and not you personally. You cannot just close down the company and walk away with the stock to start the phoenix without the debt. t time. The business has been really steady over the years, we have always made a profit and increased each year. The initial covid lockdown didn't really affect us, in fact with the 50k BBL we used it correctly and generated an extra 35k gross profit from this money initially but after that our suppliers were restricted and we have then basically been living off retained profits. We are still making money each month, some times its just enough to cover all outgoing and other months its not enough which is why he retained profits are declining.I am still taking a wage and dividends but they are less than that have been for years so I am not taking the mick with it, I have to live so need paying regardless.
If our suppliers come through and we get a break then we should be okay but as the money declines in the company account the knock on effect is we then cant place orders large enough to get a break, its a bad circle to be in and I feel like we are just biding our time until the inevitable.
If it continues I need to look at how I can walk away from this with as much as possible, some people might not agree with it but for the last 10 years we have made good money, paid all taxes, VAT bills etc etc without a problem. I have a young family to provide for among other things so washing my hands and walking away without a penny isn't really an option, I need to keep it legal but I also need to protect my self for now.
We invested in a few properties over the years, they provide us some security thank god but its not a long term thing where I can live off them.
Frustrating as I know guys who are contractors or similar who took out BBL's for the fun of it, there the guys now driving round in RS6's, wearing Rolexes and having flash holidays as its was like free money for them. The legitimate people who have been honest throughout are the people like me worrying.
The only outgoing we have in regards to loans/credit is the BBL so its fairly easy to shut the business but if we do that will we then have Barclays chasing us for the money? we do have stock at value which would cover the loan to be honest but like I said I need to protect myself here, for the bank its a drop the ocean which will get rectified, for me its the difference in keeping my family going for months to come until we plan our next move.
If you go down the liquidation route you might be able to have someone purchase all the stock for pennies on the pound and buying the assets from OldCo which will be used to pay the liquidators fees and the bank will see nothing of it.
The BBL was for businesses that were hit to "bounce back". If initially you weren't affected by covid and business and profits actually increased then why did you take a loan intended for recovery?
You've tried hard to paint a picture of a conscientious business trying desperately to fulfill its financial commitments and stay a float. But from the fact you're still taking a wage, paying yourself dividends and have accumulated personal assets which sound considerable. To me It just comes across as another BBL have your cake and eat it story.
You've tried hard to paint a picture of a conscientious business trying desperately to fulfill its financial commitments and stay a float. But from the fact you're still taking a wage, paying yourself dividends and have accumulated personal assets which sound considerable. To me It just comes across as another BBL have your cake and eat it story.
Sy1441 said:
I think if were being honest in the cold light of day that a company that's traded then been liquidated that has paid part of BBL will not be chased up by the lender or ultimately the government.
Really?I wouldnt be so sure. The liquidators will look at spend by the company during its final years of trading.
I was talking to my accountant about that sort of scenario and he very much believed the liquidator would {attempt to} claw back any directors dividends paid to pay towards a BBL.
What that means in reality in terms of actually recovering the funds i'm not so sure, but it will certainly come under scrutiny.
Gassing Station | Business | Top of Page | What's New | My Stuff