What is Business Bankruptcy?
When a business cannot pay its debts, owners may consider legal debt solutions including business bankruptcy or a Business Proposal. Business bankruptcy is complex and it’s important for business owners and stakeholders to understand all potential liabilities and repercussions.
Because there are different types of business structures, options for business debts can vary greatly.
- For example, if your business is a sole proprietorship or partnership, the assets and debts of your business are also your personal assets and debts. A business bankruptcy in this case would amount to a personal bankruptcy, or bankruptcy may be avoided entirely by instead filing a Consumer Proposal.
- If your business is a corporation or limited company there is still a personal liability created for certain debts, such as money owing to employees for wages, and to Revenue Canada for GST debt or payroll source deductions. In these situations, a Licensed Insolvency Trustee will help you determine your corporate and personal liabilities and whether a corporate or personal bankruptcy, proposal, or other solution would be most beneficial.
Book a confidential free debt consultation with Sands & Associates to discuss your situation and evaluate your debt solutions.
We understand that the decision to wind down a business struggling financially can be difficult and emotional. Our Licensed Insolvency Trustees are qualified to administer corporate bankruptcies and ensure all statutory requirements are met and that the business bankruptcy is administered in a cost-effective, professional manner.
For more information about how to manage business debts and business debt solutions, please Contact Us