Email David Kirk direct by clicking on his name.

Close this search box.

How To Dissolve A Partnership With Financial Problems

Last updated: June 10, 2021

The quick answer

If the business is a solvent partnership then it will be dissolved by agreement between the relevant parties in accordance with a partnership agreement. If the business partnership is insolvent and cannot pay its debt then it will go into Liquidation, Administration or a Partnership Voluntary Arrangement (“PVA”). 

In more detail

There are two types of partnership. The first is a partnership where all of the partners are jointly and severally liable for the debts. The other is an LLP where there is limited liability.

In the case of an insolvent partnership needing dissolution, the usual route is Liquidation. In more urgent situations Partnership Administration can be used as it is a faster option. It is also very useful where a business can be rescued as it stops all legal action, such as the bank, appointing a receiver.

For a normal (non LLP) partnership, the partners are all jointly liable for the debts not paid for by the partnership assets. This can have serious implications for the individual partners which might mean that a PVA is a better route and even possibly Individual Voluntary Arrangements for the partners.


If you need insolvency advice the earlier you talk to someone like us the better as you will have more options. We can help, contact us today.

More questions in this section

Author: David Kirk - ACA FABRP
Everything you need can be done online.
No need to meet anyone in person.
We cover all of England and Wales.
Just a quick email to say a heartfelt thank you for your very calm, considered, expert advice regarding my circumstances on Tuesday. Things looked bleak before you explained my options much more clearly, in simple layman’s terms.
Rob Elliott (14th December 2021)



Sign up to our newsletter

Request a callback

Simply fill out the short form below and I will get back to you.

David Kirk Portrait

David Kirk

Licensed Insolvency Practitioner