Read more about -bounce-back loan misconduct
What happens if I am unable to pay my bounce-back loan back continued
Misconduct
If your company accounts or bank statements can demonstrate that the money was used for the benefit of the company then it should be treated no differently to a normal unsecured loan from any institution, your firm can be liquidated and the loan written off.
What happens if I am unable to pay my bounce-back loan back
The bank that issued the loan will chase your firm for the debt and interest etc will be added to the loan. Only when they (the bank) have exhausted all chances of getting the loan and costs back will they try and fall back on the government guarantee., this is more likely to be when the firm has been dissolved
A licensed insolvency practitioner will normally require face-to-face meetings with you
A licensed insolvency practitioner will normally require face-to-face meetings with you and will look thoroughly into your personal role as to how you ran the business. They will make enquiries into affairs such as whether the firm was trading when you knew it was insolvent, and preferential payments to creditors, (including directors )
In general, they have to establish whether or not you operated the company dishonestly or not
Bank statements and accounts will also be scrutinised and any personal payments into your own or family accounts will need to be explained.
A creditors winding up meeting will normally be held, which you will have to attend, all your creditors are also invited to attend. If the firm is wound up then a notice will be published in the London Gazette which will include the directors’ details. This can also have a negative impact on being able to get credit for a new business or register for VAT
Could you just stop trading and just forget about your company, hoping that companies house will dissolve it?
Your firm is unlikely to be automatically struck off by HM company’s house if a bounce-back loan is in place.
Your bank the one that issued the bounce-back loan will very likely object to any strike-off notice once the notice appears in the London Gazette. So the company will be kept alive so to speak unless it is put into voluntary liquidation.
Is there an alternative to the stress and expense of winding up a firm myself?
Yes there is another solution sell your business transfer legal ownership Resign all directors amend shareholding change PSC records and the registered office etc