During the Covid-19 pandemic, a staggering 1.4 million businesses took out finance like a Bounce Back Loan (BBL). It was the right thing to do if you were unable to trade, income had dropped, and you still had people to pay. That you knew you could ride out the storm.

Obviously, when the BBLs first came out we didn’t know how long the pandemic would last so some businesses also topped up their BBL – again something they hadn’t planned to do.

Business owners are worried about repaying their Bounce Back Loan

What we’re hearing from business owners is uncertainty to take action if they’ve come to the realisation that they’re no longer able to repay their BBL, the company is insolvent and will need to close down.

They’re concerned that taking out the loan and then becoming insolvent will land them in hot water. Let’s explore that assumption…

If you’ve used the BBL for what it was intended, that’s fine.

The Bounce Back Loans were intended to help businesses bridge the financial gap during an unprecedented event. They weren’t created to ‘catch directors out’ further down the line. If you took out a BBL and used it help pay staff, creditors and to keep your viable business going, then you did the right thing.

No one could predict how long the pandemic would last or how it would impact our daily lives. If after two years regular trading did not return, the loan was utilised and the business could not survive, its unfortunate but unlikely anywhere to attribute blame.

If you’ve made a mistake, there’s always a conversation to be had.

Let’s say you used the BBL to cover some business costs… but you also spent the money on a luxurious holiday, a new car and you upgraded a few electricals around the house. That is going to raise some eyebrows. It’s the role of the insolvency practitioner to investigate what has brought the company to the financial position it’s in today.

We appreciate a big question on your mind is “am I going to be liable for repaying the BBL back personally?” We’ll be honest, in some cases, yes you will.

But what’s important to remember is you won’t know for sure until you have a conversation with an insolvency professional (like us).

No conclusion can be made until all the facts have been established, and that can only begin once we hear from you. Our team are experts in helping directors who are in positions like this. If you call us today, we can have a confidential chat about the situation and then you’ll know, rather than make assumptions, about potential routes forward.

Call us today on 0808 196 8676 or email help@trusolv.co.uk.