For any directors who may have taken a more relaxed approach to their director’s duties during the COVID-19 pandemic, it is important to be aware that the temporary “suspension” of the wrongful trading rules ended on 30 June 2021.
The rules were suspended from 1 March 2020 until 30 June 2021 – albeit there was a short period between 1 October 2020 and 25 November 2020 where they did apply.
If a director is found guilty of wrongful trading, they can be made personally liable for the company’s debts.
Many of the measures in place to help protect businesses, such as the furlough scheme and prohibitions on winding up petitions and forfeiture action, have helped support businesses during the past 18 months of uncertainty, but they, too, will come to an end shortly.
In order to minimise and hopefully avoid personal liability, directors must ensure that they fully understand and comply with their obligations and duties and take advice where necessary. Our team of experts are on hand to help with that advice and our quick guide to director duties provides a helpful overview of those duties.