Am I Responsible For the Debt of My Business?

Am I Responsible For Business Debts If I File For Bankruptcy

Am I Responsible For the Debt of My Business?

If your business is incorporated, you may still have personal obligations for certain debts.

  1. Debts that you guaranteed – Commonly, shareholders provide personal guarantees to banks for loans or mortgage. To Bank or finance companies for equipment or vehicle financing or leases and some suppliers may require personal guarantees.

  2. Director Liabilities – If you are a director of a corporation, you may be liable for certain debts. The most common debts that fall into this category are; unremitted payroll deductions and HST, and the penalties and interest. Also, directors are generally liable for environmental damages caused by the Company. Corporate income taxes are not a personal obligation of the directors.

  3. Unpaid wages – depending on the province where the corporation is registered, the director may also be responsible for unpaid wages.

If you operate your business as a sole proprietor, you are personally responsible for all the debts of that business. If you are a partner in a partnership, you and your business partner are jointly liable for all the debts of the partnership, not just your own portion.

Individuals with businesses often require debt solution options that resolve both personal and business debts, you can’t fix one without dealing with the other. Consultation with a Licensed Insolvency Trustee experienced with business-related debts is extremely important.

Powell Associates Ltd. is a Licensed Insolvency Trustee. We are experienced, hands-on insolvency practitioners who understand the personal impacts of major financial stress; 

  • You won’t be stuck in an assembly line process. 

  • You will expect and receive prompt responses and resolution of issues from our supportive and experienced team.  

  • We will review your debt solution options, including filing a consumer proposal or personal bankruptcy. 

  • We help Canadians with overwhelming debt get fresh financial starts.  

Once you file a consumer proposal or personal bankruptcy, we deal directly with your creditors on your behalf. Your unsecured creditors are required to stop contacting you or continuing legal proceedings against you. Contact us for a free consultation.  

We offer free consultations to review your financial situation and practical debt resolution options. Contact us to discuss your situation over the phone, a video chat, or in-person in Saint JohnMonctonFrederictonCharlottetownDartmouth, or Miramichi.