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
If a winding up petition is served on you and not dealt with quickly it can lead to your bank account being frozen and your company being forced into liquidation. If your company goes into liquidation you will lose control of it and it will cease to trade.
A bankruptcy petition is the name of a petition on an individual who is not a limited company. The limit for a bankruptcy petition increased to £5,000 from the 1st October 2015.
There are various options open to you when you receive a petition. These are:
- Pay it off.
- If it is wrong dispute it. You may need a solicitor.
- If it is correct and you want to go into liquidation then maybe let the petition run.
- If it is correct and want to save your business then seek professional advice from a Licensed Insolvency Practitioner like us on how to stop it.
If in doubt it is always worth taking some initial insolvency or legal advice.