Redundancy

Redundancy

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for a sole trader facing paying out redundancy to employees.

The woman has been trading for nearly 30 years from the same rented premises. She has 4 long term employees (over 20 years each). The landlord has signed an agreement to sell the premises to a development company and not renewed the lease, but offered a month by month licence. The client now has no premises to include in a sale of the business (she is close to retiring) and cannot face trying to find new premises and move. 

Her net profits for the last 3 years have been steady at around £30k p.a. and the redundancy payments will be around £30-35k mark.

As a sole trader she is liable to pay unless she is bankrupt.

Would the situation have different had she traded as a ltd co?

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By Tosie
02nd May 2013 16:53

yes

She could have taken all the profits as a salary and then liquidated.

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