1. Assess your financial situation

The first thing you should do is to assess your debts and the money owed to you.


  • setting up a record keeping system to help keep track of your financial situation
  • speaking to an accountant or business adviser.

2. Get advice and help

There are many agencies and experts who can help you manage your debt. These include:

3. Prioritise your debt

Prioritising your debt can be a quick way to get creditors off your back. Begin by identifying what you can afford to pay now, what you can pay later and when to go on a payment plan. A budget can help plan and direct your money where it matters the most.

4. Chase up money owing to you

Contact late or non-paying customers for payments they owe you. This will help improve your financial situation to pay off your own debts.

5. Talk to organisations you owe money to

Speaking to your creditors early can prevent late penalties or calls from debt collectors. When you talk to them:

  • explain your circumstances
  • ask if they have any hardship provisions
  • ask if you can extend the due date, make a partial payment or go on a payment plan
  • keep a record of your conversation.

If your debt has been passed onto a debt collector, there are certain laws they need to comply with. Find out your rights and responsibilities by:

6. Contact your bank

Talk to your bank about your finances and explain what you’ve done so far.

It’s a good idea to prepare a profit and loss statement or cash flow forecast. These can give your bank an understanding of the issues your business is facing. This can help when applying for financial hardship.

7. Apply for bankruptcy or insolvency

Before you do anything, seek help from a professional, such as an accountant. They may be able to suggest other ways you can repay your debt that don't involve bankruptcy or closing your business.

There are different bankruptcy arrangements that apply to sole traders and partnerships, and companies.

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