1. Introduction
This chapter covers certain types of debt that arise during or after running a business. It also looks at the ways in which the debts or strategies covered elsewhere in this Handbook need different consideration when advising someone who is, or has been, running a small business.
This chapter must be used in conjunction with the rest of the Handbook. Provided you are familiar with the processes of debt advice outlined throughout, this chapter will often be a starting point when dealing with someone who has recently run, or is running, a business.
It has been updated for recent developments due to the outbreak of coronavirus disease (COVID-19) but should be read alongside the latest government guidance and COVID-19 legislation.
This chapter is not a guide to business credit or business viability, which are both specialist areas in their own right.
Debt advisers often declare themselves unable to deal with a person’s debts while s/he is still running a business, and it may be necessary to refer people to other professional specialists – eg, tax or business advisers. Business Debtline, a free telephone helpline for self-employed people and small businesses, can advise clients who are still trading (tel: 0800 197 6026). However, this chapter assumes that some limited involvement with the debts of a trading businessperson is possible. In addition, many ancillary debts (particularly after a person has ceased trading) can be handled by a debt adviser.