Taking the Liquidation route proved to be the undoing of this Company Director, read on to find out why.
Mr Vaidas Vaiciulis (“Mr Vaiciulis”) breached the terms of the Bounce Back Loan (“BBL”) Scheme by causing Daily Cars Premium Ltd (“DCP”) to overstate its turnover on its application for a BBL resulting in the company receiving a BBL of £50,000 when he knew, or ought to have known, that DCP was only eligible for a loan of £10,115.
In that:
- The BBL scheme terms allowed businesses to receive a loan of up to 25% of their annual turnover for the 2019 calendar year, which the applicant would self-certify when completing the BBL application.
- Companies established after 01 January 2019 were permitted to use an estimated turnover from the date the company started to trade.
- DCP was incorporated on 02 September 2019 and began to trade from 11 November 2019.
- Mr Vaiciulis declared on the company’s BBL application form an estimated annual turnover of £200,000, and consequently on 28 July 2020 DCP received a £50,000 BBL, the maximum amount claimable under the BBL scheme.
- Bank statements for the period 11 November 2019 to 24 July 2020 show total receipts of £28,299.64 attributable to business income.
- This represented 256 days of trade.
- Based on the level of trade achieved, an estimated annual income could be calculated as £40,460.
- This would have meant the company was eligible to apply for a BBL of up to £10,115.
- The overstatement of turnover totalling £159,540 meant that DCP received £39,885 more than it was entitled to from the BBL scheme.
- At liquidation, DCP had liabilities totalling £65,548.52 of which £47,131.99 was owed to the bank in respect of the BBL.
