If you or your business owes a creditor more than £750, they could pursue you for this debt by issuing a winding-up petition.
You may have already received a Statutory Demand or a County Court Judgement (CCJ), which if not dealt with then can have serious consequences for you or your business. If you do not act, these can result in your company being forced to close.
Winding-up petition: What Happens Next?
From the issue date of the petition, you have just 7 days to act. If a Creditor has issued you with a winding-up petition, you need to act immediately. If you do not, you risk your company being liquidated. This is the process by which a company is closed and its assets are sold to pay Creditors. Call us today or use the live chat at the bottom of the site, to receive immediate advice about your situation.
Winding-up petitions are publically advertised. Once this happens, Banks are likely to freeze your company’s bank accounts, effectively stopping you from trading from that date.
Once a Creditor issues a petition, the courts will hold a hearing to establish if your company is truly insolvent and cannot pay its debts. If deemed insolvent, the court will issue a winding-up order and will appoint an Official Receiver to liquidate the company.
How does a winding-up petition affect Directors?
Once an order is granted, the liquidator will investigate the company and its Directors to ensure that the company’s failure wasn’t a result of fraudulent trading or wrongdoing on the Directors’ part.
They will look at transactions over the last two to five years, to establish whether they need to be undone. This includes any BBLS or CBILS loans that have been issued to the company.
If there is any evidence of wrongdoing, this will be reported to the Insolvency Service and can lead to a fine and/or Director disqualification and compensation order.
The Directors could also be made personally liable for any debt if a court decides that they acted wrongfully in some way, this includes:
- Preferential Creditors
- Personal Guarantees
- Breach of Companies Act Duties
- Overdrawn Director Loan Accounts
What are your options?
Winding-up petitions are extremely time-sensitive. Once a winding-up petition has been issued, you have days to deal with it. If your business has been issued a Statutory Demand or CCJ, or you think this may happen, you need to move quickly to prevent this and get the best representation in your corner.
Our team are available now to provide you with options and help get your finances back on track.
Call us on 0330 159 5820 or use the chat below to speak to an expert today.