Nowadays, the only reason numerous businesses are shutting down is this universal situation, popularly called COVID-19, which has ruined folks’ lives and successful businesses. This pandemic has taken a toll on the business industry. For masses who were dependent on businesses, they have no other resort but to neglect and shut down without any help from different debt management services.

As the business owners need to pay back to their creditors, you might need to apply for a personal bankruptcy case, and it depends on what type of business you own or whether you have limited liability or unlimited. Check for your business so that you can have an idea of how to start over.

Sole proprietorship or unlimited partnership

A proprietor is the only one who manages all the operations of the business and shares all profits and losses on his own as he has unlimited liability. It means that if the entrepreneur faces any losses due to debts or issues of business, his personal assets will be utilized to pay off all the creditors. Similarly, the partnership also has unlimited liability, and lenders will pursue every single partner’s personal assets to secure their money.

If business creditors get into your personal assets, then you need to register for Personal Bankruptcy Surrey to diminish that debt in the case of sole proprietor and partnership. Bankruptcy works for unsecured debts of a business. The bank or the lender will take control of your assets linked with your business to pay off the creditors.

Company

As a company has limited liability, which means they have a distinct entity from its name. When you apply for bankruptcy, the bank or lender will definitely take all your business assets to settle all the secured creditors’ debt amount. To apply for bankruptcy, you need about $20,000 to pay your Licensed Insolvency Trustee (LIT) and a bankruptcy lawyer.

Well, if you are lucky and smart enough that you didn’t link any assets with your company, then you can back off from paying any debt amount to the creditors.

Personal guarantee

The name says it all; if you have guaranteed a person to pay the debts from their personal assets, then you have to ask them to pay them. There are some legal acts that make the directors responsible for paying all the money, such as unrelieved GST, HST under the Federal Excise act, and daily wages under provincial Employment Standard acts.

You know about your business and make sure that you are making the right decision before starting over.

Final Verdict

Are you looking for filing personal bankruptcy in Surrey or simple debt management services to make Interest free Payments, Credit720 is your financial partner to aid you in all your debt management situations. Contact them today for availing services in Vancouver.