Insolvent Process Management
No business wants to declare itself insolvent but if your business faces financial difficulties then it’s important that you understand the insolvent process. Business insolvency normally happens when a company is unable to pay its bills or has far more liabilities than assets. Even if you believe your business is just suffering from temporary financial problems, it pays to get the right advice in case things continue to get worse.
Business insolvency in the UK is dealt with under the Insolvency Act and Rules. This is a legal process that requires accredited experts to implement the correct insolvency process.
There are four main options to consider when managing the process:
- The first is to contact all your creditors and see if you can come to some arrangement. This is something we can help with and have worked on many cases where this approach gives businesses the time to recover and get back on track.
- You can also do this in a formal manner by entering into a company voluntary arrangement.
- If the insolvency is more troublesome, you may well find your company in administration which means an insolvency practitioner will take over your business.
The final option is to go for liquidation. This can be instigated by the directors and shareholders when they agree there not enough assets to cover the company liabilities. Essentially, it means that a liquidator or licensed insolvency practitioner again takes over, closes your company, sells the assets and pays off creditors as far as is possible.
Which option is best for your business will depend on your circumstances. If you are currently experiencing issues around insolvency, it is vital that you get the best advice immediately.
At liquidation.co.uk, we have licensed insolvency practitioners on hand to provide the guidance you need.
Contact us free today if you want to find out more.