Insolvency advice hub
These guides focus on practical insolvency decisions. Each opens with a short answer, then explains the next steps, related questions and official sources. Use the categories below or search the website.
Recognising financial distress
Is my company insolvent?
Your company may be insolvent if it cannot pay debts when they fall due or its liabilities exceed the value of its assets.
How do I choose an insolvency practitioner?
Check the named practitioner’s authorisation, experience, proposed role and written fees before appointing them.
What should trustees do if a charity is insolvent?
Trustees should establish the charity’s legal structure, assess its ability to pay debts and obtain specialist advice promptly.
How does insolvency differ for sole traders, partnerships and LLPs?
The legal structure determines who owes the debt and which insolvency procedures are available.
Liquidation and closure
How long does company liquidation take?
Putting a company into liquidation and completing its liquidation are different stages.
How to prepare a company for liquidation
Prepare for liquidation by protecting company assets, assembling complete financial records and obtaining advice before making unusual payments or transfers.
Can I sell company assets before liquidation?
An asset sale before liquidation is not automatically prohibited, but it must be properly justified, valued and recorded.
Company strike-off suspended: what happens next?
A suspended strike-off usually means Companies House has a reason not to complete dissolution, such as a creditor objection.
Directors and personal exposure
What happens in a liquidation investigation?
A liquidator reviews why the company failed, what happened to its assets and how directors managed its affairs.
Preferences, undervalue sales and wrongful trading
A liquidator or administrator can challenge certain transactions made before insolvency.
What happens to a personal guarantee in liquidation?
Company liquidation does not normally cancel a director’s personal guarantee.
Am I personally liable for company debts?
Directors are not normally personally liable for a limited company’s debts simply because it fails.
Does liquidation lead to director disqualification?
Liquidation does not automatically disqualify a director.
Can I start again after company liquidation?
You may be able to run another business after liquidation, but you cannot simply transfer assets, abandon debts or reuse a prohibited name.
Can HMRC make directors personally liable for company tax?
Company tax arrears do not automatically become the director’s personal debt.
Can I take dividends or salary when the company is struggling?
Dividends require sufficient distributable profits and proper approval; cash in the bank alone is not enough.
Employees and creditors
What happens to employees when a company becomes insolvent?
Employees may be made redundant, continue working or transfer with a business sale, depending on the procedure and outcome.
Can a company director claim redundancy pay?
A director may qualify for statutory redundancy and related payments if they were genuinely an employee and meet the relevant conditions.
Who gets paid first in company liquidation?
Creditors are paid according to legal priority, not who demands payment most strongly.
A customer has gone into liquidation: how do I claim?
Contact the appointed liquidator or administrator, confirm that your business is listed as a creditor and provide evidence of the debt.
Creditor pressure and HMRC
My company bank account is frozen: what can I do?
First ask the bank why the account is frozen.
Statutory demands, CCJs and enforcement against a company
Identify which document your company has received and act on its deadline.
Can I liquidate a company with a Bounce Back Loan or CBILS debt?
An outstanding Bounce Back Loan or CBILS facility does not prevent a company entering liquidation.
What if I miss an HMRC Time to Pay payment?
Contact HMRC as soon as you know a payment will be missed.
Rescue and restructuring
What is a company moratorium?
A standalone company moratorium gives an eligible business an initial 20 business days of protection from many creditor actions while rescue is explored.
What is a restructuring plan?
A Part 26A restructuring plan is a court-supervised process for a company facing financial difficulties to reorganise liabilities.
What happens if a CVA is rejected or fails?
A rejected CVA does not create the proposed repayment protection, while a failed CVA must be dealt with under its agreed terms.
What is LPA or fixed-charge receivership?
LPA or fixed-charge receivership usually allows a secured lender to appoint a receiver over particular property or assets under its legal powers.
Core services and existing guides
- Business rescue and restructuring
- Company liquidation and closure
- Creditors’ Voluntary Liquidation (CVL)
- Members’ Voluntary Liquidation (MVL)
- Compulsory liquidation
- Company administration
- Pre-pack administration
- Company Voluntary Arrangement (CVA)
- Help with HMRC arrears
- HMRC Time to Pay arrangements
- Winding-up petition help
- Business cash-flow problems
- Director responsibilities when a company is in difficulty
- Overdrawn director’s loan accounts
- Company liquidation costs
- Company dissolution and strike off
Procedural guidance focuses on England and Wales unless stated otherwise. Ask for advice for your jurisdiction and circumstances.