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WHAT HAPPENS TO EMPLOYEES IN A LIQUIDATION

The employees of an entity that is liquidated must also be dealt with, as is dealt with all the other processes. The employees become creditors of the business that is liquidated. If the staff are not paid salaries or retrenchment packages immediately before liquidation, they become creditors (like all other creditors) against the insolvent estate. SALARIES Employees are entitled to [...]

2018-04-11T19:19:21+00:00 April 11th, 2018|

Insolvency: A summary of the history

A SHORT HISTORY OF INSOLVENCY ROMAN LAW Adebtor who could not pay his/her debt under Roman law, could be sold into slavery.  In the worst case, the person could be cut into pieces and each creditor given a piece, so that one is not prejudiced over the other.  Very glad those days are over... THE LAW CHANGED Fortunately for us [...]

2018-04-11T19:17:02+00:00 April 11th, 2018|

Nine things Trustees must do to properly manage a Trust

Trustees: Nine important must do's Trustees are often appointed without the persons being appointed having any knowledge of how to manage a trust. There are at least nine things trustees must do with care to make sure that a trust is managed well. 1. Keep documents safe The first of the nine things Trustees must do, is to the Trust [...]

2017-06-20T23:11:55+00:00 May 18th, 2017|

Owing VAT to SARS is not a crime

Owing VAT to SARS is not a crime Owing VAT to SARS is many a business owner’s nightmare.  SARS threatens with criminal action and tells you it is theft.  What do you do? Can SARS really lock you up for not paying VAT? There is good news: SARS can’t! This was confirmed by the Supreme Court of Appeal on at [...]

2017-06-27T12:01:14+00:00 May 11th, 2017|

Suretyship definition

The consequences of signing surety for a debt can be devastating Signing surety for a debt means that one person stands in for the debt of another. The classic case of suretyship is when a member of a Close Corporation or director of a Company signs surety for the debt of the entity.  Should the business fail to pay the [...]

2017-06-28T13:20:52+00:00 May 3rd, 2017|

Owing VAT is not theft

Owing VAT is not theft Owing VAT explains: a company (as well as its directors/shareholders) or a Close Corporation (and its members) that receives VAT but does not pay over VAT to SARS, cannot be prosecuted for theft. SARS has tried this route often in the past and each time the Courts have found that not paying over VAT that [...]

2017-06-28T16:49:34+00:00 May 3rd, 2017|

Liquidation does not stop you from being economically active

Liquidation does not stop you from being economically active because it is just a tool that you use to get rid of a business with problems so that you can try, try and try again. I often consult with people who fear that if they liquidate their business they will be penalised and will never be able to own a [...]

2017-10-24T17:03:00+00:00 April 10th, 2017|

SARS debt is written off in a liquidation

SARS DEBT IS WRITTEN OFF WHEN YOU LIQUIDATE The only SARS debt that is not written off in a liquidation is any taxes that are owing under the Customs and Excise Act, because, in terms of this Act, the manager of the premises of the business is personally liable to pay these taxes. All other taxes, which include VAT, PAYE [...]

2017-10-24T17:04:35+00:00 April 10th, 2017|

To liquidate is not necessarily a negative experience

Liquidate? A quick guide to our thoughts. To Liquidate is not necessarily a negative experience if it is handled by professionals like us who know how to take you through the process so that you stay on your feet. Liquidation is a great tool in the arsenal of surviving mechanisms that any business owner can use when the time is right. [...]

2017-06-20T22:03:41+00:00 April 10th, 2017|

Liquidation psychology

Liquidation psychology can play a very big part, if not the biggest, in helping or hampering a business owner to have a successful business. The single biggest factor, I find, is the decision a business owner has to make whether to liquidate or not.  This is what I refer to as liquidation psychology:  the state of the business owner's mind [...]

2017-10-24T15:49:58+00:00 April 10th, 2017|

The Liquidation Process

The Liquidation process is, from an attorney’s perspective, a complicated and technical one. From a practical perspective, the liquidation process is a fairly simple one. Making the decision to liquidate The most difficult part of the liquidation process is for the directors or shareholders of a Company and the members of a Close Corporation to make the decision to liquidate.  [...]

2017-10-24T15:55:29+00:00 April 10th, 2017|