Giving up work temporarily or permanently

Some people decide to stop working when they are diagnosed with cancer. This might give them more time to spend with their family and friends. It’s important to discuss your options with a financial adviser before deciding what to do. You may be able to sell your business or transfer the ownership.

If your business is failing, you may want to close it before you are forced to. Write a plan to protect your personal assets and reputation. For example, your plan should include collecting all money owed to you, selling remaining stock and giving notice to your employees.

There are different processes you will need to follow, so get advice from a financial professional, such as an accountant.

Other people choose to take early retirement from their business. You may qualify for ill-health retirement. You can get advice from your pension provider or financial adviser.

Speak to one of our financial advisers on 0808 808 00 00 about your options.

Closing your business

Some people make the decision to give up work completely when they are diagnosed with cancer. This allows them to focus on their health and other aspects of their lives such as friends and family.

If you decide to close your business, speak to a financial adviser and take the time to think through your options. Depending on your situation, you may be able to sell the business or transfer the ownership.

If your business is struggling

Some people may wish to continue their business, but despite their best efforts, it may start to fail. If you know your business is failing, you may want to close it down yourself before you are forced to.

It may take months to close a business fully. You will need to think carefully about the effect this will have on your finances. Consider the money you will receive from other sources such as a pension, savings, shares or benefits.

Unfortunately, if you wish to keep your business going and it continues to fail, there are a range of potential outcomes that you may need to consider.

If you have a limited company which owes suppliers or lenders money that it can’t pay, it may be forced into insolvency. An appointed person (a liquidator) will take control of your business and sell the assets in order to pay the debts. This process is called winding up.

If you are a sole trader or part of a partnership, you can be forced into bankruptcy. In Scotland, this is called sequestration.

If your business is struggling, you can get free and confidential advice from Business Debtline. They cover all regions in the UK.

Writing a plan

Writing a plan that outlines everything you need to do can help you protect your personal assets and reputation.

Your plan should include:

  • Collecting all money owed to you. You could offer a discount for immediate payment. Do this before you notify your customers or clients that you will be closing your business. You will find it difficult to recover debts later.
  • Selling any remaining stock – consider a clearance sale.
  • Telling your creditors. This includes suppliers, banks and anyone else you owe money to.
  • Telling your customers and dealing with outstanding obligations. Return monies for products not delivered or services not rendered. You may be able to claim on your business or professional insurance if you can’t fulfil a contract.
  • Giving your landlord the required amount of notice to terminate your lease.
  • Giving notice to any employees and following regulations to ensure they are treated fairly.
  • Paying your company debts as far as possible – a financial adviser can tell you about the best way to do this to protect yourself.

Other financial and legal steps

If you are a sole trader, you must inform HM Revenue & Customs (HMRC) straight away that you are closing. This may also help your finances. If your income will be lower, you may be able to reduce your tax payments. There is helpful information about what you need to know about tax when you stop trading.

If you are trading as a limited company, the process of closing your business will depend on whether you can pay your company debts. Visit gov.uk/closing-a-limited-company for further guidance. While your company is being wound up, it must still file and pay tax returns. There is useful information on nibusinessinfo.co.uk for businesses in Northern Ireland.

Getting support

It is important to speak to a financial adviser to follow the correct process. This can differ depending on whether you are a sole trader, a partner in a business or a director of a limited company.

If you are registered for VAT or employ staff, you will have extra responsibilities. This may include making redundancies. In England, Scotland and Wales, Jobcentre Plus can advise you if you need to make redundancies, or you can visit gov.uk/staff-redundant/getting-help In Northern Ireland, visit nibusinessinfo.co.uk/content/redundancy-options or contact the Labour Relations Agency.

It is a good idea to ask a professional, such as an accountant, to guide you.

Your feelings

Deciding to give up your business is a big step. If work has been a major focus in your life, it can be difficult to adjust. It may help to talk to someone about your feelings. This could be a family member or a friend. Some people find it easier to talk to a counsellor. You may be able to contact a counsellor through the hospital, your GP, or a cancer support group.

I was unable to work and was immediately in financial difficulty. I phoned Macmillan after my kidney operation. It wasn’t just the financial help they gave me, it was that they cared.

Jacqui


Early retirement

If you want to take early retirement on health grounds or for personal reasons, it is essential to take advice from your pension provider or financial adviser.

Ill-health retirement

You can normally only access private pension schemes from the age of 55. But you may be able to retire and claim your pension early because of ill health.

Your illness usually has to be permanent and stop you from working, but it may depend on the rules of your pension scheme.

If you qualify for ill-health early retirement, your pension scheme will tell you what your options are. You can also find out more from the Pensions Advisory Service on 0300 123 1047.

If your life expectancy is less than 12 months

If you have a life expectancy of less than 12 months, you may be able to retire because of serious ill health. You will usually get the whole of your pension as a one-off lump sum.

The whole sum will usually be tax-free. In this case, a registered medical professional must give evidence to the scheme administrator that your life expectancy is less than a year.

Any money you take from your pension, but do not spend or give away before you die, will become part of your estate. Your estate is the money and property you leave behind.

We have more information about pensions that you might find helpful.

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