Winding up Petition and Creditor Voluntary Liquidation

The Challenge

The company had ran into difficulty after trading for 18 years due to the falling sales and the loss of a major contract. The VAT had fallen behind as had the PAYE and HMRC had been chasing the directors for a settlement. Initially the directors agreed a payment plan with a field officer for the VAT office. The directors then agreed a further payment plan for the PAYE so had two payment plans on the go at the same time. They found cash-flow very tight but managed to maintain all arrears payments. Unfortunately they missed a payment for the next quarters VAT and the payment plan was cancelled as this was a condition of the payment plan with HMRC that had been overlooked by the directors. HMRC had lost confidence and wanted all the money outstanding in one payment which now amounted to £56,000. The Debt Enforcement Unit were insisting on all monies being paid and eventually issued a winding up petition. Acting on the advice of their accountant they borrowed funds from the family to repay the HMRC debt. Unfortunately another creditor was waiting in the wings and used the same petition to continue the winding up process for a £12,000 debt to be heard in the High Court in London.

OVERALL DEBTS TO THE COMPANY: £56,000 plus penalties – COMPANY TURNOVER: £233,000 – 3 EMPLOYEES

Winding up Petition and Creditor Voluntary Liquidation Case Study

The Solution

Out of desperation the directors contacted us after searching on the internet and the accountant was not returning their calls. By the time they had contacted us the petition had been advertised in the London Gazette and the bank account was frozen. The company was in dire straights and they had very few funds and no tangible assets remaining and they couldn’t go to the family seeking help again. We immediately contacted the lawyers of the petitioning creditor and agreed to pay their legal costs on the basis the directors would liquidate the company and the winding up petition action ceased immediately. This allowed us to set up a new company and arrange a payment plan with the liquidator to purchase the core intangible assets of the company such as its good name, telephone numbers, website , contracts etc.


A new company was set up within 48 hours and the core of the company was saved and the directors retained employment.

 

 

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