Happily, provisions have been made to relieve the pressure - taking the form of the Omnibus Act.
This new Act recognises that business is no longer proceeding as usual, and debts can be problematic. Under the Act, directors are no longer personally liable for any debt incurred in the ordinary course of business, even if the company is trading whilst insolvent.
That’s right; insolvent trading is now a safe harbour for directors.
While the Omnibus Act doesn’t define when a debt is considered to have been incurred “in the ordinary course of business”, according to the explanatory memorandum, a debt is incurred in the ordinary course of business if the debt is necessary to keep the business afloat during the six months following 25 March 2020.