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I ’ m a Business Owner , Get Me Out Of Here !
Steve Elliott is Business Recovery and Insolvency Partner at Monahans , the South West ’ s leading accountancy and business advisory firm .
Insolvencies are on the rise . In England and Wales , the number in December 2022 was 32 % higher than in the same month in the previous year and 76 % higher than three years previously . Financial uncertainty in recent times , rising costs , supply chain issues and fluctuating government policies have led to many businesses being forced to consider an exit from their business .
Are things as gloomy as the media might have you believe ? It ’ s not black and white , but we do risk talking ourselves into a downturn .
Having said that , many who managed to survive the pandemic by remaining adaptive , making use of loans and grants and , above all , staying determined are now considering the prospect of insolvency . This is partly due to the delayed impact of the pandemic . Some are facing higher tax liabilities owing to the timing of grants , or are struggling to pay back government loans , accentuated by rising business costs .
That ’ s before you factor in the emotional , personal impact on business owners . The pressures of recent events have undoubtedly impacted people ’ s resilience and confidence going forward . That is partly why it is not just those in difficulty who are contemplating an exit ; many successful companies are opting to cash in and sell or retire whilst the going is good , exiting through a solvent Members ’ Voluntary Liquidation (“ MVL ”) and the tax advantages that brings .
For those who are considering their options , as with all financial decisions , information is key . Liquidation is impacted substantially by the wider economic climate – and future government budgets and statements may shift parameters – so consulting with an expert will help with navigating the complexities of the process .
For example , as alluded to above , business owners may qualify for Business Asset Disposal Relief , formerly known as Entrepreneurs ’ Relief , and be eligible to pay Capital Gains Tax at 10 % when they take out what is left in their company under an MVL .
As for the wider outlook , the early signs in 2023 are that pressure is beginning to be felt at the smaller end of the market and predictably it ' s those who are least well off that will suffer the most . However , rather than avoid the subject , we are encouraging businesses to speak to their accountants and business advisors . At Monahans , we provide a friendly , approachable service and understand all of the real and potential implications of your business decisions .
Our dedicated Business Recovery & Insolvency team may be able to show you options that circumnavigate insolvency , or if that is your decision , take the sting out of the process , certainly helping achieve the best return on exiting your business , at the lowest possible cost . Finding the best solutions for our clients in what can be a stressful time of their lives is what we ’ re here for ; we want people to be able to get back to sleeping at night !
Get in touch with Steve Elliott at Monahans for advice on 01793 818 300 .
Visit Monahans online at : www . monahans . co . uk
“ Finding the best solution for our clients in what can be a stressful time of their lives is what we ' re here for ”
With more than 100 years of Accountancy and Business Advisory experience , we have the knowledge and understanding to anticipate your needs , no matter what .
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