Business Failure

Many businesses, small or large, require credit to start trading as the initial costs and overheads can be considerable. Once established the business may also require further credit facilities to allow investment in new stock or to allow the business to function while waiting for payment from customers.

Liability for business debts depends on the type of business you are involved in.

For example

Some businesses are run by co-operatives, which are governed by the Industrial and Provident Societies Act and not the Companies Act. The profit made by a co-operative company is not distributed to its shareholders but goes back to the company. This type of company protects its shareholders from responsibility for any company debts.

See business debts for further advice

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