It’s certainly not been plain sailing for UK transport and logistics businesses of late, with headwinds continuing to cause problems in an industry that was severely affected by the coronavirus pandemic.
The fall in trade between the UK and the EU following Brexit has led to declining revenues for many transport firms that rely on cross-border trade. Several other factors are contributing to slow growth in the sector and sending many firms on a downward spiral.
If you operate a transport or logistics company that’s struggling, you need to understand your options. As a team of licensed insolvency practitioners, we can provide urgent advice on liquidation and the company rescue options that can keep your business afloat.
In recent years, the UK transport industry has been negatively affected by Covid and Brexit, but while the pandemic has eased, the effects of Brexit are still being felt.
Increased restrictions to travel are causing disruptions to traditional delivery routes, while the ongoing driver shortage is pushing up wages and making it difficult for firms to grow their businesses. That, combined with the delays at ports around the UK, is making moving goods through the UK more challenging and expensive than some businesses can manage.
If your transport or logistics company is experiencing a downturn, seeking professional insolvency advice early on is crucial. Liquidation is one avenue to explore if your business is no longer financially viable, but there are also rescue options that could enable you to keep trading.
At UK Liquidators, our licensed insolvency practitioners can help you better understand your current financial position and the options available so you can make an informed decision.
If the business is no longer viable and it’s in everyone’s best interests to close it down, a Creditors’ Voluntary Liquidation (CVL) is the right way to proceed. It enables you to close the business in line with the relevant insolvency laws and protects you from the potentially serious repercussions if you continue to trade with no realistic prospect of recovery.
Although no company director wants their business to end this way, voluntary liquidation can help you make the best of a bad situation. By entering into a CVL, eligible staff can claim redundancy pay and you may also qualify for a redundancy payout as a company director.
Although the name might suggest otherwise, a Creditors’ Voluntary Liquidation is a procedure you initiate as the company director. You choose a licensed insolvency practitioner to act as the liquidator who will close the company on your behalf.
A key part of the liquidator’s role is to value and sell the company’s assets to repay your creditors as far as possible. Once they have distributed the funds to your creditors, any remaining debts will be written off and the company will be struck off the Companies House register.
As we mentioned earlier, you may be able to claim director redundancy pay, which averages around £10,000, when you liquidate your company via a CVL. To be eligible, you must:
Liquidation may not be your only option. We can help you identify rescue and recovery measures that can turn your business around. A formal agreement called a Company Voluntary Arrangement (CVA) - which allows you to repay your debts over time while continuing to trade - could be appropriate.
Alternatively, it might be possible to restructure the business so you can continue trading without the unprofitable elements that were contributing to your decline.
We offer a free, same-day consultation to assess your financial situation and discuss the rescue and liquidation options available to your transport business. Call our confidential advice line or arrange a free face-to-face consultation at one of our 100+ offices throughout the UK.
If you are considering liquidation for your limited company, taking advice from a licensed insolvency practitioner can help you understand your options.
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If you are considering liquidation for your company, taking expert advice at an early stage is crucial. At UK Liquidators, our team of licensed insolvency practitioners are committed to providing limited company directors with the help and advice they need to make an informed decision.
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