What is a Winding-up Petition?
Well, a winding up petition is a very, very serious threat, and it's something that you must react to and you must react quickly. What does it mean? Essentially, this means that a company or a creditor has lost patience in chasing a debt. Typically, that debt has to be over seven hundred and fifty pounds, and there shouldn't be any dispute about the debt. So if you do dispute the debt, you should go and get legal advice and take action to stop any winding up petition on the basis that it is disputed. If you don't dispute the debt and the company simply can't pay it, well, then clearly the company is insolvent under the insolvency legislation.That then means that the directors must act, and they must act in the best interest of the creditors. Typically, that will mean doing deals to pay back money over time, negotiating with creditors, and so forth. However, if that has failed, creditors may then issue something called an application to the high court to prove that the company is insolvent and to effectively ask the high court to wind the company up and place it into something called liquidation.Now this is a very serious step for the court to take, and they will only do so if there is no dispute and the company has not made any effort to pay the debt back. So typically, people ask us what does a winding up petition mean and what can I do about it? Well, what you can do about it is to act. You can pay the debt back.You can agree to pay the debt back over a period of time. We can help with that. That's called a time to pay or TTP, and we can help with that. However, if the company simply can't make that payment in time, either you let the winding up petition turn into a hearing at which the company will be liquidated by the high court or you look at something called a company voluntary arrangement, which we can help you with, that allows a deal to be done with the company's creditors, including the petitioning creditor over a significant period of time.The most common source of winding up petitions is Revenue and Customs. The tax man has a process, and if they are going to issue a winding up petition, they will always have a discussion with you, and they will always issue a seven day warning letter. Please don't wait until after you've had the seven day warning letter. Please act before that.Talk to us quickly. Have a look on our website. We can actually achieve an adjournment of the winding up petition using our lawyers near the high court, and we can get the company under control and then propose a deal with the credits over a period of time. And typically, that time could be five years as opposed to a very short repayment program.So in summary, a threat of a winding up petition is extremely serious. The directors must act. They cannot sell the business. They cannot sell assets if the winding up petition has been issued.They can't put the company into pre pack administration, which is a very powerful tool. They cannot put the company into liquidation. So a lot of the techniques and tools have been removed from them because they've allowed the winding up petition to be issued. Yes.There is still hope. You need to go to our website, company rescue dot co dot u k, and you need to call us to get advice quickly. We don't charge for the initial advice, and we can get a a member of our team around to see you very, very quickly. But you please must act.This is very serious now.
