Hi Ellie
You are in exactly the same position I was at the beginning of the year, pumping more and more money into, what was for me, a bottomless pit. We (my daughters and I)had a gift and card shop which did really well in its first year (2003) but steadily went down hill after that reflecting the general retail trends and, for us, the increase of the internet in supplying goods.
Christmas was always our good period but this year I found myself unable to pay the VAT for the last quarter. I approached my bank who had been brilliant and they refused to loan me any money which I am so glad now that they took such a responsible attitude over. The very nice lady told me off the record that if proprietors are needing a loan to pay VAT then the bank immediately knows that the business is in trouble and so obviously wont take the risk ... it's a different thing loaning money to a business that is thriving and developing than a failing one!
A good friend of mine who has also run his own businesses in the past also made me think when he said that if a business is in te position that the outgoings are exceeding the income then one has a moral obligation to cease trading otherwise one is acquiring goods on credit somewhat fraudulantly.
With regard to your standing I'm am not sure that anyone would necessarily know what your financial situation is, perhaps you could direct any available funds to ensuring that wages are paid ... fulfilling your moral obligations to the local community. The most important thing I found in this situation was to be one step ahead of the situation and to have a strategy. And I think that it shows a responsible and professional approach to dealing with a situation which is likely no reflection on you personally but instead a reflection on the current economic climate ... we were doing fine until Gordon Brown first put interest rates up a couple of years ago ... and It's about time that VAT was applied to goods bought via eBay!
This for me has been going on for the best part of 2yrs, I had at one point got it addressed under an IVA but a big monster called THE LEASE came up and bit me in May this year.
I am currently in a situation whereby I am hoping to make a full and final offer to my creditors including my landlord which will hopefully see him agreeing to a surrender the lease ... if not I will be in a position where i have no debts but will petition for my bankruptcy in order to wipe out the lease.
Hope this helps
Debbie
www.babynamings.co.uk
www.soulgrowth.co.uk
... might be worth a free phone call. 
