Any money owed by your business is considered a business debt. A business debt may be considered either a priority or a non-priority debt, with priority creditors being awarded stronger powers to regain the money they are owed. In order to keep the average cost of capital to a minimum, a business must be able to balance their use of debt and equity.
When it comes to getting on top of what your business owes, it is advisable to tackle priority business debts first. Examples of these debts include business rent arrears, income tax arrears, VAT arrears, business rates, national insurance arrears, debts owed to major suppliers, and overdue accountant bills.