British expat business owners now under threat of losing everything

British expat business owners now under threat of losing everything

British expat business owners now under threat of losing everything

Expat businesses in Spain’s Costa del Sol are at serious risk of permanent closure due to the coronavirus’ threat to tourism.

Local British auditors and accountants are warning an extended lockdown could see the end of a huge number of expat-owned tourism sector businesses. Self-employed traders are at an even worse risk of folding should the present lockdown be extended for any length of time. Closed signs are up and stretch all along the famous coastline, with no chance of any revenue for at least 14 days.

Many expat bar and restaurant owners believe a six-week shutdown is feasible, a scary prospect for those who’ve already seen turnover fall dramatically. Many British expat small business owners sunk all their capital in a home and bar or restaurant after selling their UK properties, leaving nothing to see them through emergencies such as they’re now facing. Relying on takings for running costs including rents and salaries is never a good idea, and at present many will still be covering staff wages for as long as they’re able.

Unlike the British government’s attempts to keep SMEs running during the crisis, the Spanish government has done nothing except delaying tax payments, and Spanish banks aren’t expected to be a supported as their British equivalents. One British auditor believes as many as three UK expat SMEs will fold daily should the lockdown lasts six weeks or more. The peak time for the virus is expected to come around the end of June into early July, with tourism to Spain non-existent by then and resident expats hunkering down as regards spending on all but essentials.

Good business people will become financial victims of the virus’s advance across Europe and the UK, not just by closing down but by losing years of saving and investing in lease payments of £100,000 or more which can’t be resold if they’ve defaulted on a payment. The expert believes even expat landlords could be at risk of losing their properties due to not being able to continue making mortgage payments, adding that governments who force closures and lockouts should be made legally responsible for losses by traders and subject to successful claims for reimbursement.

Should the present crisis result in a worldwide recession, investment property may well be unsaleable for a number of years, and measures to prevent total disaster should now be high on every country’s agenda.

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