Winding Up Petition in the UK
Do you have an unpaid invoice with a value of £750 or more and can you prove that your debtor is unable to pay? Then you may want to consider the Winding Up Petition, also known as compulsory liquidation. If your debtor refuses to pay, you can request the court to liquidate the company through a creditor. Essentially your debtor’s assets are collected and distributed amongst the creditors. In order to initiate this petition, it is advised to hire a solicitor to act on your behalf.
Winding Up Petition explained
When applying for the Winding Up Petition, you will first have to ensure that you have undertaken all pre-legal steps. From calling your debtor to sending demand letters, you must ensure that you have sufficiently notified your debtor of the outstanding claim.
In most cases, the Winding Up Petition is used as a final precaution to an unpaid invoice when all other attempts have failed. The court issues a fee of £280 with a deposit of £2,600 to manage the winding-up. The court will review the case, and if accepted, your debtor will have to respond within 7 days.
After the petition has been accepted a petition advertisement will be released, which publicly announces the bankruptcy of your debtor. The announcement also lists the date and details of the hearing in the High Court of Justice. The bank will then freeze your debtor’s accounts and assets.
What effect does the Winding Up Petition have?
If you are successful, then the company’s assets are sold, and any legal disputes will be settled. The amount the debtor owes to you and other creditors will be distributed. Note that you may not recover the entire amount that is owed to you, which is why you need a solicitor who can help recover it for you.
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Winding Up Petition fees
The Winding Up Petition is a costly procedure, partially because the outcomes are so severe. In order to issue the Winding Up Petition, you will have to pay a court fee of £280 with a deposit of £2,600. These costs exclude the hourly fee which you will have to pay for hiring a solicitor. You can contact us for more information.
Have you exhausted all possible resources for your debt collection? Then you may consider initiating the Winding Up Petition. Our debt collection specialists and lawyers can help you retrieve your payment. With knowledge and experience with the debt collection laws in the UK, our specialist can strengthen your position and retrieve the payment you are entitled to.