Directors Redundancy Payment
Despite Government support via grants, CBILS and Business Bounce Back Loans it’s still very difficult for Company Directors to project cash flow. Although some businesses are thriving at the moment many Company Directors are worried and unsure about the future of their business, especially in the building and construction sector.
In March 2020 the number of Companies in the construction sector that Liquidated was 474. I’m sure this number will increase over the coming months as the full impact of Covid-19 on the economy is felt throughout the UK.
Liquidating a company is not something a Company Director willing chooses but often circumstances dictate that this is the only option. The impact of liquidating your company can be devastating personally, professionally and financially.
What many Company Directors don’t realise is that they might qualify for directors redundancy along with a number of statutory entitlements including notice pay, holiday pay and unpaid wages. The final settlements are paid direct to you as the Director and the payment can be utilised in any way you choose. At what is a difficult time the payment could be used to pay for the company liquidation; to clear personal debts including Personal Guarantees that have been signed with Trade Suppliers; or used to establish a new business.
Do You Qualify For Directors Redundancy Payments?
- You must also be regarded as an employee along with being a director of the company .
- You must have been working under a contract of employment for two years.
- Working a minimum of 16 hours per week.
- Owed money by the company this could be initial investment or PAYE arrears.
How To Claim For Redundancy?
Once it’s established that you are an employee of the company and that you meet all necessary criteria. A claim can be made from the National Insurance Fund via the Redundancy Payment Service. If you are unsure if you qualify for director redundancy we can recommend a Specialist Independent Assessor to look over your claim and provide honest and transparent feedback.
How Much Redundancy Pay Will I Receive?
This differs dependent on many factors including length of service; rate of pay and age but it is not unusual to see claims to range from £2,000 up to £10,000 and more in some cases.