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Bounce Back Loan Help For Limited Company Directors

If you're a Limited Company Director who has taken out a Bounce Back Loan, you may be wondering what happens if you can't repay it. Defaulting on your Bounce Back Loan can have serious consequences for you and your Ltd Company, but there are options available to help you manage your loan repayments and avoid any potential legal action.

At The Directors Helpline, we understand how difficult it can be to manage your business finances during these challenging times. If you would like an initial, confidential overview of your company's financial position before speaking with us, our Business Health Check can help you highlight rsisks and potential solutions. We also offer free tailored debt advice to help you navigate your Bounce Back Loan repayment and explore your options for managing your debt obligations.

I Can't Pay My Bounce Back Loan

As a Director of a Limited Company, if you can't pay your Bounce Back Loan, it's important to take advice as soon as possible. Ignoring the problem will only make it worse, so don’t wait until it’s too late.

Defaulting on your Bounce Back Loan can have serious consequences for you and your business. If you find yourself unable to repay, the lender (the bank) will likely start taking steps to recover the debt. This can include sending demands for payment, charging interest & late fees, and even petition to wind the company up, forcing it into Compulsory Liquidation. This is not recommended.

If you want a clearer picture of your company’s financial position before taking action, our Business Health Check can help identify risks and potential solutions.

Get in touch today, and we can guide you through these challenging times to help get your business back on track.

Can I Write Off My Bounce Back Loan?

When it comes to bounce back loans, the only circumstance in which the loan can be “written off” is if your business fails and enters a formal process such as Liquidation.

If you find yourself unable to repay the loan, the PAYG Scheme is available as an initial option before considering Liquidation. It is highly recommended to seek advice from an experienced team who can provide tailored guidance based on your specific circumstances.

We can assess all your potential options and provide valuable insights to help you effectively manage the repayment or liquidation process. We can also check if there would be any personal implications ahead of the Liquidation option. Get in touch today.

Can I Close My Business With A Bounce Back Loan?

Yes, you can close a Limited Company with a Bounce Back Loan through the process of Creditors Voluntary Liquidation.

However, it’s important to seek trusted guidance first, as closing a Limited Company with a Bounce Back Loan could have serious consequences to you personally. The Bounce Back Loan debt belongs to the Limited Company, not the Director personally, but there are certain circumstances (such as misuse) where you, the Director, may still be liable for repaying the loan even if you close your Company.

If you’re unsure where you stand, our Business Health Check can provide a confidential overview of your company’s position and highlight any potential risks before you take action. We can also provide you with tailored debt advice to help you navigate the complexities of closing your company with a Bounce Back Loan.

We can help you understand your options and the personal implications so you can choose a solution that works best for both you and your business.

Can I Dissolve My Company With An Outstanding Bounce Back Loan?

In short, no. The bank is likely to object to the application for closing your company through dissolution/strike off.

The proper way to close it is through a formal Liquidation process, but it's important to understand the process, the role of the insolvency practitioner, and any personal implications before proceeding.

Contact The Directors Helpline to assess your situation and determine if Liquidation is the right course of action for you.

Frequently Asked Question

Have a question? We're here to help!

What is considered HMRC debt?

Company debts to HM Revenue and Customs (HMRC) can arise from a range of taxes, including corporation tax, VAT, PAYE, and National Insurance contributions. These debts can often be one of the main causes of financial problems for UK businesses.

It's important for businesses to address HMRC debt issues as soon as possible to avoid these consequences. The Directors' Helpline can provide guidance on how to deal with HMRC debt and help you find a solution that works for you and your company.
Can HMRC Check Business Bank Accounts?

HMRC has the power to inspect business bank accounts in certain circumstances. This can happen if they suspect that you're not paying the correct amount of tax or if you're involved in other fraudulent activities.

If you're concerned about HMRC checking your business bank accounts, it's important to seek professional advice. The Directors' Helpline can provide guidance on how to protect your business and ensure that you're complying with HMRC regulations.
What Is a Time to Pay Arrangement? And How Do I Apply?

A Time to Pay (TTP) arrangement is a formal agreement with HMRC that allows you to pay your tax debt over a longer period. However, it's important to note that a TTP is not a solution for all businesses. HMRC will only grant a Time To Pay arrangement if they believe that you can realistically pay off the debt within the agreed timeframe.

To apply for a TTP arrangement, you need to contact HMRC directly. Time To Pay Arrangements are usually made over the phone with HMRC. During the phone call, you will be asked a few questions regarding your company. This includes the circumstances which have led to your company being unable to pay its outstanding bill, and to state what you can afford to pay on a monthly basis. You can call HMRC on 0300 200 3300.
Can HMRC Come to My House?

Yes, HMRC has the authority to visit your business premises, and if your home address is the registered address on Companies House, they could come to your home. The purpose of a HMRC visit is to inspect your records or investigate suspected tax fraud. However, such a visit is usually a last resort after other measures have been exhausted.

If you're worried about an HMRC visit to your home, it's recommended that you seek professional advice. The Directors' Helpline can provide guidance on how to prepare for an HMRC visit and ensure that you're complying with HMRC regulations.
How Long Does Business HMRC Debt Last?
HMRC can persist for a considerable amount of time if the debt is left unresolved. HMRC can be very aggressive and have the authority to pursue debts up to 20 years old, so there's no chance of them forgetting what is owed. Failure to address the debt in a timely manner can result in legal action, with HMRC having the power to:
- seize assets
- take court action
- pass the debt to a debt collection agency
- initiate Compulsory Liquidation
To avoid such consequences, it's crucial to deal with the debt issue promptly. Seeking professional advice from The Directors' Helpline can help you navigate the situation and find a solution that works for your business.