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National Debtline

Advice you can trust

Business debts

Do you have cashflow problems?

No matter how well you have planned your business, you may be at risk of cashflow problems, especially during the first few years when your business is developing.

business debts - red haired woman

What is a business debt?

  • If you are self-employed, any money your business owes is known as a business debt.
  • Business debts can be priority or non-priority.
  • Priority creditors have stronger powers to get their money back than non-priority creditors.

Priority business debts

These include:

  • business rent arrears;
  • business rates;
  • income tax arrears;
  • National Insurance arrears;
  • VAT arrears;
  • debts to major suppliers; and
  • accountant bills.

Non-priority business debts

These include:

  • some bank or building society loans;
  • overdrafts and credit cards;
  • charge cards;
  • catalogues;
  • doorstep-collected loans;
  • payday loans; and
  • non-essential business suppliers.

Are you self-employed?

It can be confusing about what it means to be a sole trader, a partnership or limited company.

  • Sole traders are individuals who run their own business and work for themselves. They may also have employees.
  • Partnerships are businesses where two or more people run a business together.
  • A limited company is run by directors and shareholders.

Still trading?

  • If you are self-employed, our sister organisation, Business Debtline can give you advice on dealing with business and personal debts.
  • Business Debtline has a team of specialist advisers ready to help with your queries. Call them on 0800 197 6026.

Before calling Business Debtline

For Business Debtline to give you full advice, they will need information about your business and personal financial affairs.

  • Make sure you have information ready about your business and personal income and outgoings.
  • It will help if you complete a rough business budget sheet before your call.

No longer trading?

  • If you are no longer trading but you still have outstanding business and personal debts, you can ring National Debtline for advice about how to deal with your business debts.
  • You will also find our Business debts fact sheet helpful.