If your business faces closure this year you will no doubt have plenty of things on your mind to worry about without adding personal worries to the equation. One of the major concerns for many directors is the potential impact on their own financial future and their credit rating in particular. To ease those worries, here’s some advice on how your company going into administration or liquidation may or may not affect your credit rating.
If you have a good or excellent credit rating, the last thing you want is for your failing business to bring down the shutters on that too. The good news is, in most cases a having your company go into liquidation or administration is not going to impact on your personal credit rating at all.
It may of course have an indirect impact further down the line even if you find yourself unable to pay bills which will be a separate matter.
When you run a limited company as a director or shareholder, you are treated as a separate entity from the business when it comes to your credit rating. Creditors can in most cases only pursue the company for debts rather than the individuals who run it.
The exception is when a director has provided a personal guarantee or they have a director’s loan account that is overdrawn. In these cases, a director will be putting their credit rating at risk as well as their own money if they are made bankrupt as a result.
If you are unsure about anything related to insolvency concerning your business, contact us for advice today.