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sir in defination of wrongful trading it is said that ” before the start of winding up, the director knew or ought to have known that there was no reasonable prospect that the company would avoid going to insolvent liquidation”
isn’t it director intentionally carrying business knowing that they are soon going to be liquidated?? I thought it was fradulent behaviour.
The difference between fraudulent and wrongful (apart from the punishments and the fact that one is a crime and the other isn’t!) is that fraudulent is committed with intent
Wrongful is more innocent ” …or ought reasonably to have known…” where fraudulent is “…setting up or carrying on … with intent to defraud creditors”
OK?
my company has large debt . i know I couldn’t pay that debt but still I ask loan with other creditors. so is this wrongful or fraudulent ?
Why are you asking for more? Is it so that you can afford to trade yourself out of trouble or are you simply trying to get more out of honest people so you may then disappear taking this extra money with you?
Could you have known, or could you reasonably have been expected to know, that your entity would not be able to avoid commencing an insolvent liquidation within the next 12 months?
Did you set up the entity in order to defraud your creditors?
Take your pick and there’s your answer
Could you have known, or could you reasonably have been expected to know, that your entity would not be able to avoid commencing an insolvent liquidation within the next 12 months?
so if this is a case, it is wrongful. right? my intention is to pay .. so i guess it’s not a fraudulent 🙂
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