Limited Company or Sole Trader?

Quite often we get calls throughout a week and a common question is "Am I protected?". What is the main difference to you as a person in business between a limited company and a being a sole trader? The simple answer is protection. When heading for insolvency a sole trader has the distinct disadvantage that their person debts and the business debts are one in the same thing. This is not always the case if you are running a limited company.

A benefit of having a limited company to a director is the protection that the limited liability status provides. If all of the company debts are unsecured and there are no personal guarantee signed on any of the agreements with creditors then you are far better protected that if you were a sole trader.

Clearly this does not mean that you can neglect your company's creditors, but what it does mean is that you can manage the situation with more personal security and less stress.

This seems to be a common misunderstandings when speaking with business people in the UK when discussing insolvency and the risks involved.

Alternative Investment Firm to Pay Out More Than They Hoped for

An alternative investment firm, Centaur Global Limited was liquidated back in January and is now being told to repay some of its creditors after an in-depth investigation by the liquidators, Begbies Traynor.

A representative at Begbies Traynor said that they were able to maximise the potential return for the creditors due to a full investigation taking place.

Centaur owed creditors around £2m at the point of liquidation and the creditors had no expectations of getting a return, however, since the investigation the situation has moved in their favour.

Centaur was an investment firm focussing on running a number of funds worth millions surrounding online sports exchanges for the odds on sporting event outcomes.

It just goes to show that even when a limited company has been put into liquidation it doesn't mean that important areas go unnoticed. It is the Liquidators responsibility to carry out these types of investigations and make sure that all areas such as this are fully addressed before moving onto the next case.