Services in detail - Closing a business
For various reasons some companies cease trading and decide to dissolve the business. Ascot Drummond can assist with all the legal requirements for closing down a company. We also provide a final set of accounts and corporation tax return.
When you close your business, you will need to inform various people and organisations of your decision, closing-a-and the timescales involved. This could involve quite a lot of planning and organisation. For example, if your business is a company or limited liability partnership, you'll need to inform Companies House that you are closing it down.
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Preparing to Close a Business
Closing down a business can be a difficult time but careful planning can help. It helps to have a plan of action as you bring your business to a close. Your plan should ideally list everything you need to do under headings, such as tax requirements, rentals and leases, and closing accounts with suppliers and customers. Ascot Drummond can help you do this. We will also inform the authorities on your behalf, submit the necessary forms to Companies House and prepare a final set of accounts.
Employer's Responsibilities When Closing a Business
If you have employees, you must safeguard their rights, finalise their pay and deductions, and issue their P45 form.
The position of an employee with regards to rights to redundancy pay, company pension payments etc, will vary according to the circumstances of the business closure (e.g. insolvency, voluntary liquidation) and the business type (e.g. partnership, limited company, sole trader).
Employees who lose their job as a result of your business closing may be entitled to certain National Insurance-related benefits. You may be able to help them make their claim, and provide documentation needed to back it up.
Insolvency and Bankruptcy
Bankruptcy is one route you can take if you have debts you cannot pay. It frees you from your debts, but your assets are divided among your creditors and restrictions are placed on your future business activities. If you become bankrupt through no fault of your own, these restrictions are generally lifted after 12 months.
A company may be forced to close by being taken to court by its creditors, lenders, shareholders, or by the government or legal authorities seeking to wind up the business.
Should you need additional advice, we can refer you to insolvency and bankruptcy specialists.