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Month: June 2012

3 Legal/Debt Collection Terms Explained

1) County Court Judgment (CCJ.) – A CCJ is a legal document that is obtained against the debtor after legal action has been taken. This document enables enforcement to be carried out.

2) Sheriff Fee. – A Sheriff Fee is an enforcement fee taken by a Bailiff, following a Judgement to obtain goods to the value of the Judgment debt.

3) Affidavit. – An Affidavit of Service is carried out in court and under oath. The Server of legal process testifies their service.

 

What is a Statutory Demand?

Statutory Demands are one of the most useful tools in recovering debt. A Statutory Demand is a formal, legal demand of payment being fulfilled within 21 days of the demand being served. They are also a warning of consequential action if the debt is ignored. Consequences such as legal action, the winding up of a company or even bankruptcy generally ensure swift payment of the debt in over 80% of cases. It also informs the debtor of their right to dispute the demand, and who to pursue if they wish to do so.

I am owed money, Is a Statutory Demand suitable for my needs?

–          Due to the Statutory Demand having the option of dispute, they can only be used to resolve previously undisputed debts.

–          A statutory demand comes at a serving cost, so they are suitable for debts over £750, but more realistically suited to debts over £2000 to ensure financial benefit.

–          Statutory Demands apply only to England and Wales as Scotland practise different legal procedures.

“Yes, they owed me over ten grand. They paid up though, after a Statutory Demand”

-Kerry Bland.

 Ensure the Statutory Demand is personally delivered, preferably by an experienced Legal Process Server (such as Jack Russell!) to avoid any potential problems later down the line.

What do I do if I’ve received a Statutory Demand?

–          If you have received a Statutory Demand, you have 21 days (or 28 if you live abroad) to satisfy the demand. – The demand can either be paid in full or an agreement can be put in place if you wish to pay in instalments.

–          If you wish to dispute the Demand, you have 18 days (or 22 if you live abroad) to do so.

DO NOT ignore it. Ignored Demands can have serious financial consequences to you or your company’s financial health.

Trading Status – What is a ‘Limited Company?’

When you call Jack Russell for help recovering a debt we will ask you for your trading status. Most commonly we ask you, ‘are you a Limited Company?’ Read our guide for help answering this question…

Limited Companies (Ltd).

 

  • A Limited Company is the most common type of company in the UK.
  • The company must trade with their full name, including their trading status of Limited or ‘Ltd’.
  • They must be registered on the Government website, ‘companieshouse.gov.uk’ with their unique company number, which cannot be changed.
  • ‘Limited’ means that the Shareholders or Directors of the company have limited liability for the company’s debts in the event of dissolution or liquidation. The shareholders are only liable for their own capital and not company debts.

Public Limited Companies (Plc).

 

  • A Plc requires a minimum of two Directors.
  • The Directors are again limited to liability of their own capital only.
  • The company’s shares are freely sold and traded to the public, if you have bought shares in a company it’s most likely to be a Plc.

Limited by Guarantee.

 

  • A company that is Limited by Guarantee is most often a charity or a non-profit organisation.
  • This type of company has no Shareholders or share capital.
  • The Directors are only liable for very small amounts of money that they usually have contributed themselves.

Partnerships.

 

  • A Partnership requires two or more people to be Partners.
  • The Partners share everything equally, including liability, profits and losses.
  • This means that unlike a Limited Company, the Partners are equally liable for company debts.
  • A Partnership is easy to form and operate and doesn’t require Government registration.
  • Partnerships enjoy tax benefits as the partners are only taxed on their own income and not the company profits.

Limited Liability Partnerships (LLP) and Limited Liability Companies (LLC).

 –

  • LLPs and LLCs are very similar in terms of tax and liability. Both types are governed by laws or acts, such as The Limited Liability Partnership Act (2000). The biggest difference between them is that LLPs are generally restricted to professionally licensed individuals such as Lawyers and Accountants, whereas LLCs can be formed by any business or persons.
  • Thanks to liability being limited, both LLPs and LLCs provide liability protection. This makes LLPs a very beneficial type of Partnership as Partners are not equally liable for debts. LLPs also offer legal protection against the actions of another Partner.
  • LLCs benefit from only paying tax on the incomes of the Directors, unlike a regular Limited Company and alike to all kinds of Partnership.

Sole Traders.

 

  • Sole Traders have sole proprietorship and sole liability.
  • Only one person in the business, commonly a Landlord, Tradesman or Self-Employed person.
  • Does not require any type of company registration, also you must register with the tax office to complete your own tax return.
  • Easy to form and operate, you are your own business.

So which one are you?

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Jack Russell Networking Schedule Summer/Autumn 2012.

Come and meet with us, discuss how we can help your business and get free advice from the experts. We will be at the following network events…

October 2012.

31st October – Manchester Curry Club, The Rajdoot, Manchester City Centre. (Lunchtime.)

We hope to see you there!

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