What is an Insolvency Practitioner?

The Quick Answer A Licensed Insolvency Practitioner is a qualified professional who has an insolvency licence. Insolvency and dealing with businesses and individuals with debt is a regulated profession. You can not do this work without having passed an exam, being the member of a professional body and having an insolvency licence. The answer in […]

How To Know If Your Business Is Insolvent?

The quick answer There are two legal definitions of insolvency; the first is being unable to pay your debts as they fall due and the second is your liabilities exceeding your assets. If your business doesn’t have the money or assets to pay the liabilities it owes, the company is classed as insolvent. In more detail In […]

Insolvent Trading – What can happen to my Business?

The quick answer If your business is insolvent you risk being pushed into liquidation (for a company) or bankruptcy (sole trader or partners). This means your business is forced to close, all staff are made redundant and the assets will be sold to pay the business creditors. If you are trading whilst insolvent, you may […]

Is Insolvency A Breach Of Contract?

The quick answer In most cases, yes it normally is. However, for insolvency to be a breach of contact it does depend on what is actually written in any contract between the insolvent company and the customer. For example, sometimes the terms of a contract state liquidation is a breach of contract but Administration is […]

How Can I Stop My Business From Becoming Insolvent?

The quick answer The best way to stop your business from becoming insolvent is to take advice from a Licensed Insolvency Practitioner (“IP”) like us earlier rather than later. The facts an IP will need to know in order to help you are: What do you owe to creditors, the bank, HM Revenue and Customs. […]

What Is Receivership?

The quick answer Receivership is where a bank or lender appoints an Administrative Receiver who must be a Licensed Insolvency Practitioner. This can only happen on a debenture created before the 15th September 2003. After that date they must appoint an Administrator. You may also be thinking of an LPA Receiver. This is someone appointed […]

Winding Up Petitions And Bankruptcy Orders – What Is Involved?

The quick answer If your limited company is wound up by the Court or you are made bankrupt then you will lose control of your assets and your business. A Liquidator or Trustee in Bankruptcy will be appointed to sell the assets and close the business. In both cases, this person will be a Licensed […]

What Is Entrepreneurs Relief And How Do I Get It?

The quick answer Business Asset Disposal Relief (formerly Entrepreneurs’ Relief) is a Capital Gains Tax relief that means you only pay 10% Capital Gains Tax on the first £1m of gains on the sale of qualifying business assets. This can include share sales, buy backs or distributions of reserves via a Members Voluntary Liquidation. You […]

What Is A Winding Up Petition?

The quick answer A Winding Up Petition is a legal document and is served on a company that owes more than £750. It will eventually lead to the winding up of the company forcing it into liquidation if it does not pay the debt or deal with it in an alternative way. In more detail […]

What Is Corporation Tax Liability?

The quick answer A Corporation Tax Liability is owed by a limited company on either tax on trading profits, tax on a capital gain or tax on a distribution often called a section 455 liability. A section 455 liability arises from an overdrawn directors loan account not paid back within nine months of the company […]