Business Recovery Services
You have decided you need a recovery firm. The question now is whether Company Debt is the right one for your company, or whether your situation belongs somewhere else.
Business recovery services, in our usage, mean the structured work of stabilising cash, protecting directors from personal exposure, and either rescuing the company through a formal procedure or closing it without leaving avoidable damage behind.
We do this for UK limited companies, mostly SMEs, mostly with debts between £50,000 and several million.
This page sets out what instructing us actually involves, where we are useful, and where you should be talking to someone else.
If you have not yet decided that recovery is even the right path, our How to save a struggling business guide is the better starting point.
Business Recovery Services at a Glance
Quick Answer: When Business Recovery Services Help
Recovery services help when a viable underlying business is being suffocated by a fixable debt structure, a single creditor pressure point, or a working-capital squeeze that responsible refinancing or a formal procedure can resolve.
They do not help when the trading model itself has stopped working.
If you can describe a profitable post-restructure version of the company in two sentences, recovery is realistic.
If every honest description of the future relies on customers, contracts, or margins you do not yet have, you are looking at a closure conversation, not a recovery one.
When Business Recovery Is Realistic (vs When It Isn’t)
Realistic: a profitable core trading business buried under HMRC arrears, a Bounce Back Loan, and one aggressive trade creditor. A short repayment runway, a CVA, or a refinance can carve the bad debt off and leave the operation intact.
Not realistic: a company whose top three customers have churned, whose order book is empty, and whose forward forecasts depend on growth that has not started yet.
Restructuring the balance sheet of a company that no longer has a market is expensive theatre. A creditors’ voluntary liquidation is usually the kinder, cheaper answer.
Main Director Risk During Recovery Engagement
The biggest risk during a live recovery is wrongful trading exposure under section 214 of the Insolvency Act 1986.
Once you should reasonably have known there was no realistic prospect of avoiding insolvent liquidation, every further day of trading without proper advice tightens the personal-liability case against you.
Preferences, transactions at undervalue, and unrecorded director loan repayments come a close second.
You can read the detail in our guide on what an insolvency practitioner does; on this page we just want you to know we take this seriously and we will tell you, in the first call, where the line is.
What Instructing Company Debt Involves
The first call usually lasts under twenty minutes. We ask three things: what the debts are, who the creditors are, and what you want to happen to the company. Nothing more glamorous than that.
If recovery looks viable, you receive a written options letter within forty-eight hours. If it does not, we tell you so on the call and point you to the closure or referral path that fits.
There are no upfront costs and you do not pay us a penny until we both agree on the route forward.
What Does Business Recovery Mean in Practice?
Business Recovery vs Insolvency
Insolvency is a state. Recovery is the work you do about it. A company is insolvent the moment it cannot pay its debts as they fall due (the cash-flow test under section 123 of the Insolvency Act 1986) or its liabilities exceed its assets.
Recovery is the set of practical and legal moves that follow.
That distinction matters because directors often think they have to wait for “real” insolvency before acting. The opposite is true. The earlier you engage, the more recovery routes stay open.
Difference Between Informal and Formal Recovery
Informal recovery means private negotiation: rescheduled creditor payments, a Time to Pay arrangement with HMRC, an asset-based refinance, or a quiet wind-down of a single loss-making division. No statutory protection, no court involvement, no public record.
Formal recovery means a statutory procedure: a Company Voluntary Arrangement, an administration, a restructuring plan under the Corporate Insolvency and Governance Act 2020, or a moratorium.
These bind dissenting creditors, freeze enforcement action, and create a court-supervised framework.
They cost more and they appear on the public record. They also work when informal routes have already failed.
When Business Recovery May Not Be the Right Route
Recovery is not the right route when the cost of the procedure exceeds what you preserve, when the underlying business model has gone, or when you are personally so exposed through guarantees that a closure plus IVA combination protects you better than rescuing the company at any cost.
If a £40,000 administrative receivership preserves £25,000 of goodwill, the maths is against you. We will say so.
How to Assess Whether Business Recovery Is Possible for Your Company
Thirteen-Week Cashflow Forecast
The first viability test we run is a thirteen-week rolling cashflow forecast. Not the annual budget, not the management accounts, not the bank’s covenant model.
A weekly receipts-and-payments view, ruthlessly honest, with creditor pressure modelled in.
If the company can survive the next thirteen weeks on realistic assumptions and a credible creditor accommodation, recovery is on the table.
If the forecast goes negative within four weeks even after stretching every supplier, you are looking at administration or liquidation, not informal recovery.
EBITDA Bridge and Trading Viability
Cashflow tells you whether the company survives the next quarter. The EBITDA bridge tells you whether it deserves to.
We strip out one-off costs, owner remuneration above market, and discretionary spend, then look at whether the underlying trading is positive on a normalised basis.
A normalised positive EBITDA means there is a business worth saving. A normalised negative EBITDA means the trading itself is the problem and a new balance sheet will not fix it.
Creditor Map and Outcome Calculation
Before any recommendation, we map the creditor base by class: secured, preferential (HMRC PAYE, NIC and VAT under the Finance Act 2020 reinstated Crown preference), and unsecured.
We then model the comparative outcome a creditor would receive in a CVA, an administration, and a creditors’ voluntary liquidation.
If the rescue route does not deliver a materially better outcome than liquidation, the rescue will not get creditor approval and you should not pay to attempt it.
What Options Are Available for Business Recovery?
Recovery options fall into three buckets. The right one depends on viability, creditor pressure, and what you want left at the end.
Informal Agreement or Repayment Plan
For early-stage distress with a single creditor or a clear cashflow gap, an informal route often works. A Time to Pay arrangement with HMRC, a refinance against debtor book, or direct creditor negotiations can buy enough runway to trade through.
Rescue or Restructuring Procedure
For deeper distress where informal cooperation is not realistic, formal rescue procedures bind creditors and protect the trading entity.
The choice between a CVA, an administration, or a restructuring plan turns on creditor mix, urgency, and whether the brand or trade is the asset worth preserving.
Sale, Closure or Insolvency Procedure
Where the company itself cannot continue, a structured exit protects more value than drift. A pre-pack administration can preserve trade and jobs through sale to a connected or third-party buyer.
A creditors’ voluntary liquidation closes the company cleanly; a members’ voluntary liquidation distributes a solvent surplus tax-efficiently. Strike-off works only for genuinely dormant, debt-free companies.
| Procedure | Best For | Typical Duration | Trading Continues? |
|---|---|---|---|
| HMRC Time to Pay | HMRC arrears, otherwise solvent | 3-12 months | Yes |
| CVA | Multiple unsecured creditors, viable trade | 3-5 years | Yes |
| Administration | Urgent creditor protection, restructure or sale | Up to 12 months (extendable) | Yes, under administrator |
| Pre-Pack Administration | Sale of business to preserve goodwill and jobs | Sale completes day one | Yes, under new ownership |
| CVL | No realistic rescue, controlled closure | Closure within weeks; wind-down 6-18 months | No |
| MVL | Solvent company, tax-efficient distribution | 6-12 months | No |
| Strike-off | Dormant, debt-free, no creditor objection | 2-3 months | No |
What Risks Should Directors Watch During Business Recovery?
The personal-liability risks that surface during a recovery engagement are statutory, evidenced from board records, and reviewed retrospectively if the company later enters insolvency. Knowing them in advance is half the protection.
| Risk | Statutory Basis | What It Means for You |
|---|---|---|
| Wrongful trading | Insolvency Act 1986, s.214 | Personal contribution to creditor losses for trading on after the point you should have known recovery was hopeless. |
| Preferences | Insolvency Act 1986, s.239 | Repaying a connected creditor (often a director loan or a guaranteed lender) ahead of others can be reversed and pursued personally. |
| Transactions at undervalue | Insolvency Act 1986, s.238 | Selling assets cheaply to an associate or transferring property below market value can be unwound and pursued. |
| Personal guarantees | Contract law | Bank, landlord and supplier guarantees survive the company’s insolvency. Recovery planning must address them explicitly. |
| Personal liability notices | Finance Act 2020, Sch.13 | HMRC can issue Joint and Several Liability Notices for unpaid PAYE, NIC and VAT against directors of repeatedly insolvent companies. |
| Director disqualification | Company Directors Disqualification Act 1986 | Conduct in the run-up to insolvency is reviewed; bans of 2-15 years are issued for unfit conduct. |
If you would like the longer treatment of any one of these, our creditor pressure guide walks through the timing question in more detail.
The single most useful protection across all six rows is contemporaneous board minutes from the day the first serious creditor letter arrives.
What Instructing Company Debt for Business Recovery Actually Involves
The First Call: What We Ask, How Long It Takes
The first call lasts fifteen to twenty minutes. We ask for the rough debt total, the breakdown by class (HMRC, bank, trade, finance), the position of any personal guarantees, and what you want the outcome to look like.
We do not ask for management accounts or board packs on call one. They come later if a route forward looks viable.
By the end of that call you will have a shortlist of two or three realistic routes, a sense of cost, and a clear answer on the timing pressure. If you are in immediate court action territory, we say so and we move that day.
Engagement Scope: What We Cover, What We Don’t
We cover the full UK corporate recovery and insolvency stack for limited companies and LLPs: informal restructuring, creditor negotiation, CVAs, administrations, pre-packs, restructuring plans, CVLs and MVLs.
We licence and run the formal procedures ourselves where we are appointed; informal advisory work is delivered by our recovery team.
We do not act on personal insolvency (IVAs, bankruptcy, debt management plans). We do not advise on contentious litigation, regulatory defence, or tax disputes outside HMRC arrears.
Where one of those is the real issue, we will name a specialist and step out.
Cost Basis: No Upfront Fees
There are no upfront costs. You do not pay us a penny until we both agree on what needs to happen and you instruct us formally. The initial assessment, the options letter, and the call work that gets you to a decision are free.
Where a formal procedure follows, fees are set out in a written engagement letter and are paid out of the procedure (in a CVA from the contributions, in an administration or liquidation from realisations) or from director-funded sources where a connected outcome is sought.
We tell you the fee number before you commit, not after.
When Company Debt Is Not the Right Recovery Firm
Three situations where you should be talking to someone else.
Sole traders and personal-debt situations. Recovery in our sense is corporate.
If you trade as a sole trader, partnership without an LLP, or your problem is personal credit-card and HMRC self-assessment debt rather than company debt, you want an IVA or a debt advice charity, not us.
StepChange and Citizens Advice are good starting points.
Very small companies with under £50,000 of debt and a competent accountant.
If your accountant has a working relationship with HMRC, your debt is mostly a single tax bill, and there are no personal guarantees in the picture, you may not need a recovery firm at all. Ask your accountant to broker a TTP.
If it works, you save the fee.
Specialist sectors we do not cover.
We do not run regulated-firm wind-downs (FCA-authorised investment firms, banks, insurers), pension scheme employer recoveries with active section 75 issues, or cross-border insolvencies where the centre of main interests is outside the UK.
Where these apply, we refer.
Related Recovery Guides
- How to save a struggling business: pre-formal triage for the early-stage director
- Rescue your business from insolvency: comparing CVA, administration and pre-pack once formal routes are on the table
- Company Voluntary Arrangement guide: how a CVA works, what creditors decide, what it costs
- Company administration guide: moratorium, administrator’s powers, exit routes
- What is an insolvency practitioner?: regulator, duties, fee basis
Frequently Asked Questions About Business Recovery Services
How quickly can a recovery engagement start?
For a straightforward case, the first call happens the same day, the options letter follows within forty-eight hours, and a formal engagement letter is in your hands inside a week. Where a winding-up petition has been advertised or a court date is fixed, we move faster and prioritise the procedural protection first, the strategy conversation second.
What happens if recovery isn’t realistic for my company?
We tell you so on the first call and we explain why. The usual answer in that scenario is a creditors’ voluntary liquidation, which closes the company cleanly, fixes the wrongful trading clock, and protects you from the personal-liability drift that comes from prolonged insolvent trading. We can run the CVL ourselves or refer you out if you would prefer a second opinion first.
Do you take on companies with HMRC as the main creditor?
Yes, frequently. Since the Finance Act 2020 reinstated Crown preference for PAYE, NIC and VAT, HMRC has become a more aggressive creditor and a much more common reason for recovery instructions. We negotiate Time to Pay arrangements where the numbers support it and we move to a CVA or administration where they do not.
How do personal guarantees affect a recovery plan?
Personal guarantees survive the company’s insolvency. A CVA does not bind a guaranteeing lender’s right to call the guarantee against you personally; an administration generally does not either.
Recovery planning has to map every guarantee at the start. Sometimes the right answer is a procedure that protects the company while you separately negotiate a personal settlement with the lender; sometimes it is closure plus an IVA. We will not pretend the company-level fix solves a guarantee problem on its own.
Is business recovery confidential?
Initial advisory work is fully confidential. Informal arrangements (TTP, refinance, private creditor negotiation) leave no public footprint. Formal procedures (CVA, administration, restructuring plan, liquidation) appear on the public record at Companies House and in the London Gazette. If preserving discretion matters for customer or supplier reasons, we factor that in when we recommend a route.
What regulator licenses Company Debt’s insolvency practitioners?
Our licensed insolvency practitioners are authorised under the Insolvency Act 1986 and regulated by either the Insolvency Practitioners Association (IPA) or the Institute of Chartered Accountants in England and Wales (ICAEW), depending on the practitioner. The bond and the regulator details for any appointed IP appear on the formal engagement documents.
Can we restructure without entering a formal procedure?
Often yes, especially in early-stage distress. Refinance against debtor book or fixed assets, an HMRC Time to Pay, a private creditor accommodation or an internal cost restructure can resolve the problem without a public procedure. We always test the informal route first because it is cheaper, faster, and leaves no record. If it will not hold, we say so.
How much does a business recovery engagement typically cost?
The initial advisory work is free. Formal procedure fees vary by complexity: CVAs commonly run in the £7,500 to £25,000 range for nominee and supervisor work depending on creditor count and contribution profile.
Administrations and liquidations are time-cost based and disclosed in advance. Where fees are paid out of the procedure rather than by the director, the engagement letter sets out the priority order. You see the number before you commit.
