Cash Flow Problems
Cash flow is a common issue faced by companies and whilst the reasons may be clear and appear to be temporary, they can potentially lead to formal insolvency proceedings if they are not addressed. A company can be deemed insolvent if it is unable to pay its liabilities “as and when they fall due”, irrespective of whether the company is solvent on a balance sheet basis.
A company faces many daily challenges and cash flow problems are often surmountable, however it is important to take professional advice early in order to problems spiralling out of control, which in turn deceases the options available and a formal insolvency solution becoming more likely.
In our experience cash flow problems usually mean arrears with creditors, including tax liabilities. Once these accrue, there is a risk of a winding up petition being issued against the company. This can then be quite damaging to day to day trading, as once advertised the likelihood is that the company’s bank account will be frozen and the company will no longer be able to access funds to pay ongoing costs such as suppliers and employee wages. For more details about winding up petitions visit here.
THFR have years of experience dealing with HMRC. In the event of arrears with HMRC or indeed any of your creditors, we can negotiate a structured repayment plan to fit your cash flow. This does need to be a formal insolvency solution, but simply an affordable repayment agreement to provide you with much needed breathing space. Alternatively, we can provide funding options to suit your needs and cash flow requirements such as invoice discounting, factoring, fixed asset finance. For more information on you finance needs visit here.