Common Limited Company Problems

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Updated: 17th January 2021

Understanding common company problems and how to solve them

Real Business Rescue has more than 30 years' experience helping company directors in times of financial distress and our team, through its extensive presence of more than 100 offices, can provide the right solutions to suit your business troubles wherever you are.
From start-ups to SMEs to multinational corporations; from struggling one-man bands to high turnover organisations; we can quickly analyse your company situation and advise on the best rescue or closure option.
We've seen practically all there is to see in scenarios related to company distress, with the most common issues surrounding finance, insolvency, cash flow, creditor pressure, HMRC arrears, winding up petitions, overdrawn directors' loan accounts and, more recently, Accelerated Payment Notices.
FINANCE – It isn't uncommon for companies to be refused finance. Maybe your credit history is holding you back or a lack of information (i.e. newly formed companies) is turning off potential lenders. We can help your company source alternative funding through our network of specialist lenders or via innovative finance solutions including crowdfunding. Don't take your bank's rejection as definitive; in most cases we can find another route to finance.
INSOLVENCY – Insolvency is defined by your company's ability to pay debts as and when they fall due, and whether the company assets outweigh the company liabilities. If cash flow is a major concern and your company is struggling to meet its debts on time, it would be deemed insolvent and directors have key responsibilities in these circumstances with regards to trading and seeking finance. Your first port of call should be to speak to an insolvency practitioner at Real Business Rescue via a free initial consultation.
CASH FLOW PROBLEMS – Cash flow is the lifeblood of any business and when it runs dry, serious problems are afoot. It's important to recognise dwindling cash flow as soon as possible and apply changes to the way your company handles its invoices and sales ledger. There are often numerous solutions whereby subtle changes can boost cash flow when the business is viable. If the business is no longer viable, an insolvency practitioner should be consulted as soon as possible.
CREDITOR PRESSURE – Creditors that are out of pocket due to your company's failure to pay them on time can be an incessant source of pressure. Whether it's on the phone, through the post, or by turning up at your company premises, creditor pressure can arrive in numerous forms. In many cases, creditors cross the line into harassment and we can help provide your company with breathing space and deal with creditors on your behalf. We can also provide the best solutions to help cash flow or find the most effective consolidation loans where appropriate. 
HMRC ARREARS – We've helped thousands of companies over the years that have fallen behind with tax payments to HMRC – whether it's corporation tax, VAT or PAYE. We liaise with HMRC directly and can do so on your behalf in order to reach a Time To Pay agreement or general breathing space for your company in a time of financial distress. We can advise on a number of possible solutions relating to tax efficiency and help reduce the burden of HMRC pressure.
WINDING UP PETITION - A winding-up petition represents the most serious action a creditor can take against your company. The creditor is effectively petitioning for your company to be liquidated because it has been unable to meet its liabilities when they fell due. If your company finds itself in this situation, there is no time to waste. You may feel that it’s an unfair petition and that your firm can be financially viable going forward... but you must act now to save the company or HMRC will accept the petition and look to wind your company up through a Winding Up Order and place your company into compulsory liquidation.
DIRECTORS' LOAN ACCOUNTS – In many cases of company insolvency, a director will have an overdrawn directors' loan account, commonly known as a DLA. The account is considered to be overdrawn when a director has taken more non-salaried money out of the company than what they have put in. In cases where the company is in financial distress and ends up in a formal insolvency process, this is not viewed in a particularly good light and the Official Receiver is likely to pursue the excess money you have withdrawn as it would be deemed an asset that is owed to creditors. This can be a complex situation and there are numerous issues and permutations surrounding it.
ACCELERATED PAYMENT NOTICES – Accelerated Payment Notices (APNs) were introduced by HMRC in 2014 as a by-product of alleged tax avoidance schemes  being used by UK companies. Around 10,000 firms and 34,000 individuals were sent APNs last year and Real Business Rescue has experience in providing guidance to those who are concerned by the Notice arriving on their doormat. 
Director Support - Business suffering from Cash-Flow Problems?
If your company is financially distressed, we also offer the below services:
Business debt recovery

  • Recover Unpaid Invoices of £5k+
  • Expert Credit Control Services
  • Stop Late Payers & Bad Debts
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Time to pay experts

  • Get Breathing Space with HMRC
  • Support with Business Tax Arrears
  • 35 Years HMRC Negotiation
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UK Business Finance

  • Rejected for a CBILS Loan?
  • Get Emergency Business Funding
  • Supporting 1000+ UK Companies
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Who we help
  • Company Directors
  • Finance Directors
  • Sole Traders
  • Accountants
  • Small Businesses
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