can business remain seperate from IVA?

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Post by colin_ » Mon Apr 23, 2007 10:40 pm
I have a 24% share in a small business that is also my employer and sole income source. (I'm a director) Going through difficult times, combined with over stretched personal credit means I need to enter into an IVA but I'm unclear how my 24% will be viewed by the IP, and how the business in general will be affected. Will the shares be treated as an asset?
One of my personal creditors is the HSBC who are also the bankers with the company. The company has over draft facilities which of course I don't want them to withdraw when they get wind of my personal situation. The o/d facility is secured by Director's Guarantess (including from myself) which could be viewed as useless if I am personally insolvent.
The business is healthy enough as it stands, but just can't afford to pay me enough to get out of my personal debt situation.
What can you adsvise in this circumstance? Is it possible the business can remain untouched and totally seperate from my persoinal financial situation?


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Post by MelanieGiles » Sat Apr 28, 2007 9:12 am
Hi Colin and welcome to the forum

As no-one else has replied to your post - I will do so belatedly (just got back from holiday last night!)

Your shareholding will be viewed as an asset by your IP, who will want to know the value of the company in order to evaluate whether the shareholding is worth anything.

It is unlikely that the company's bank account will be effected by you entering into insolvency proceedings, but you will need to include your personal guarantee as a contingent liability if the company runs on overdraft.

You cannot really keep the business to one side, as there are things which may be effected as I mention above. Are your co-directors aware of your personal situation and the impact this may have on the company?

Regards, Melanie Giles, Insolvency Practitioner for over 20 years.

For further details contact me at and view my IVA blog at:
Regards, Melanie Giles, Insolvency Practitioner
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