Former liquidator imprisoned

Many readers may take some pleasure at reading the headline, which relates to an Australian Insolvency Practitioner (“IP”) who was found guilty of extracting over AUS$2.5 million from insolvency estates.

Whilst that IP will have plenty of time to reflect on his wrongdoing, the estates should not lose out as a regulated IP must take out a specific insurance bond, to the value of the anticipated assets in that estate, on every appointment.  This serves to protect the creditors from any financial wrongdoing by the IP or their staff.

Unfortunately, there are unregulated advisors who prey on the vulnerable making big assurances such “Use us and we help all of your financial worries go away”.  They will offer you something like:

  • You can resign as a director.
  • We shall acquire the shares.
  • Everything will be sorted, meaning you can get on with your life.

PBC have previously advised directors of the dangers of trying to “Cut corners” and use an unregulated advisor, yet those warnings do occasionally go unheeded at considerable personal risk to the directors.

On 29 July 2024 Save Consultants Limited was subject to a public interest winding up order.  This company worked alongside Davis Acquisitions Limited who were appointed as director of 78 companies.  The Insolvency Service stated Davis Acquisitions was used as the vehicle to, “Avoid formal insolvency procedures, asset recovery and director conduct scrutiny.”

Unlike the situation with the wayward Australian IP, these companies are not subject to the specific insurance requirements and, as such, the creditors will suffer greater loss.  However, the likely issue surrounding those 78 companies will be a formal winding up of each company, followed by commencement of legal proceedings for a breach of duties, which could lead to personal liability and even director disqualification for those directors who believed using an unregulated advisor was the “Easy” way to out.

Financial difficulties can often be an unpleasant and stressful experience for anyone, so it can be attractive to hear someone promising to take all of your problems away.  However, as the saying goes, “If it sounds too good to be true then it often is,” could not be closer to the truth when discussing the highly specialised area of insolvency, where, to avoid any repercussions, demands appropriate and regulated specialist advice.

If you need any advice or assistance on any corporate restructuring or insolvency-related issue, then please contact PBC Business Recovery & Insolvency on 01604 212150 (Northampton), 01908 033150 (Milton Keynes), 01234 989150 (Bedford) or email to enquiries@pbcbusinessrecovery.co.uk. Alternatively, visit www.pbcbusinessrecovery.co.uk for further information.

Can you pay in 12 months?

Are you looking to retire, close your company down and extract the surplus funds as a dividend against your shares?  This is where tax planning and a formal winding up of the business affairs via a members voluntary liquidation (“MVL”) come into the equation.

A MVL is a solvent winding up that, given certain criteria, enables the shareholders to claim business asset disposable relief and reduce the capital gains tax to (currently) 14%.  This is to increase to 18% in April 2026.  However, there is some uncertainty whether the available capital gains tax rates will remain, given the Autumn statement will be on 26 November 2025 and representations being made by the Government with regards to taxation generally.

Arguably the most fundamental part of a MVL is swearing the declaration of solvency.  This includes a statement from the directors whereby they declare all known company creditors shall be paid in full, together with statutory interest within a period not exceeding 12 months.

Where properly pre-planned, by the time you are ready to commence the MVL procedures, all liabilities have already been paid and it is a “Clean” state of affairs, requiring the distribution to shareholders.  However, what if you have a potential debt hanging over the company?  It is a liability the directors say is not owing, yet it could end up being a court matter and is likely to remain unresolved within the 12-month period.  What do you do?

Ordinarily, it would be reasonable to suggest a provision is made against that prospective liability so, if the company lose the argument or reach a settlement, the funds are there to cover the liability.  However, the recent High Court decision of Noal SCSP & Ors v Novalpina Capital LLP & Ors [2025] EWHC 1392 suggests if all debts are not paid within the specified 12 months the liquidator should be looking to convert the MVL into an insolvent liquidation.  That gives rise to investigations, including whether it was reasonable to swear the declaration of solvency in the first place.

The above decision is subject to appeal, but the key message, here, is plan thoroughly and consider all possible issues before commencing the MVL itself.  This is where PBC can assist you when approached at an early stage.

If you need any advice or assistance on any MVL, corporate restructuring or insolvency-related issue, then please contact PBC Business Recovery & Insolvency on 01604 212150 (Northampton), 01908 033150 (Milton Keynes), 01234 989150 (Bedford) or email to enquiries@pbcbusinessrecovery.co.uk. Alternatively, visit www.pbcbusinessrecovery.co.uk for further information.

Debt Awareness Week

This week is debt awareness week, and it is reported that a third of all businesses are experiencing debt issues which will likely increase over the coming months for several reasons, including various tax increases.

Nicole Anderson states “If the above resonates with you or, one of your clients,  it is important advice is sought as soon as possible. At PBC Business Recovery & Insolvency, we do not consider debt as a sign of failure. In fact, it is quite the opposite, we applaud those that give business a go, but bumps in the road are part of life – it is how you get over these bumps which is important”

Should there be a need for advice surrounding your debt problems and options available, please contact PBC Business Recovery & Insolvency on 01604 212150 (Northampton), 01908 033150 (Milton Keynes), 01234 989150 (Bedford) or email to enquiries@pbcbusinessrecovery.co.uk. Alternatively, visit www.pbcbusinessrecovery.co.uk for further information.

Members’ Voluntary Liquidations – 7 Week Countdown!

Given the recent changes on the rate of CGT that applies to Business Asset Disposal Relief on the lifetime allowance of £1Million, the clock is ticking to benefit from the current rate of 10% until 5 April 2025 on capital distributions. From this date it will rise to 14% and then 18% in  April 2026

The above could be a significant tax saving for you or your clients and, if this is being considered, the time to start acting and planning is now.

Should you wish to discuss a Members’ Voluntary Liquidation further then please contact PBC Business Recovery & Insolvency on 01604 212150 (Northampton), 01908 033150 (Milton Keynes), 01234 989150 (Bedford) or email to enquiries@pbcbusinessrecovery.co.uk.

HMRC ramping up winding-up action

It has recently been reported that HMRC appear to be ramping up the number of winding-up petitions being presented to the court. Figures published in the London Gazette for January 2025 indicate HMRC issued 480 petitions, compared to 327 presented by HMRC in January 2024.

The presentation of a petition is, generally,  the very last resort for HMRC and the recipient would have had significant correspondence with HMRC beforehand an attempt to recover the debt in an orderly manner.  If you or your client are facing the very real threat from HMRC of a winding up petition, it is imperative swift advice is sought to look at alternative options of recovery and saving the business.  

In our opinion, the hardest part for most business owners when financial trouble is imminent, is making that first contact and seeking assistance.  Here at PBC Business Recovery & Insolvency we understand this, but the sooner we are contacted, the greater the options available to you.

If you need any advice or assistance on any corporate restructuring or insolvency-related issue, then please contact PBC Business Recovery & Insolvency on 01604 212150 (Northampton), 01908 033150 (Milton Keynes), 01234 989150 (Bedford) or email to enquiries@pbcbusinessrecovery.co.uk. Alternatively, visit www.pbcbusinessrecovery.co.uk for further information.

Buy something for your money!

It is always pleasing when we advise company directors early on.  Especially when there is likely to be a bump in the road in respect of the company’s finances.   This provides directors with significant options to avoid a formal insolvency procedure.

Some of the time, the directors, believing in the company’s future, are looking to place their own funds into the company to ease the financial pressures. If they believe in the company and have the available funds, then this all makes sense.

Now, let’s say the bump in the road is too great to overcome, the directors have ploughed funds into the company, and it enters an insolvency event.  The directors will sit at the bottom of a pile as there are creditors that sit above them in the waterfall of recipients in insolvency should a dividend be paid. These are namely employee wage arrears, holiday pay and HMRC in respect of their secondary preferential status, and then secured creditors such as banks etc.

To cut a long story short, if you are a director or you have a client that is looking to shore up company finances by loaning the company funds, if the company has assets, then look to secure funds invested by buying company assets.  Make sure market value is paid and document the transaction. If the worst then happens, funds invested are not sitting at the bottom of a pile.  

If you need any advice or assistance on any corporate restructuring or insolvency-related issue, then please contact PBC Business Recovery & Insolvency on 01604 212150 (Northampton), 01908 033150 (Milton Keynes), 01234 989150 (Bedford) or email to enquiries@pbcbusinessrecovery.co.uk. Alternatively, visit www.pbcbusinessrecovery.co.uk for further information.

Is it a reasonable request?

How often has one of your clients entered into an insolvency event while owing you money?  If that is not bad enough, you then get the insolvency practitioner appointed (“IP”) demanding that you provide swathes of information and documents, at your expense.

Some IPs will inform you of your duty under section 234 Insolvency Act 1986 to deliver up the information sought and, most likely, failure to comply may lead to a court application.  Indeed, if they really wanted to get heavy they could point out the court ruled, in 2014, that you have a public duty to deliver up, irrespective of the cost to you.

The question is whether you should allow salt to be rubbed in by suffering more expense in addition to the unpaid fees you have already suffered.

What an IP will not be in a hurry to inform you is the requests for delivery up of records has to be justified and reasonable.  In a recent court case, in throwing the liquidators’ application out, the court said,

“any application for delivery of documents under the IA 86 should clearly explain why such documents are “reasonably required” and should not be unduly broad or burdensome to carry out.”

Indeed, we have seen sight of an information request with standard requests together with the following:

“Copies of any emails between you and the Company, including its officers.”  At PBC, we question if this request is reasonably required given the arduous task of collating this information, not least GDPR concerns, as some emails may not just deal with company matters but also, personal affairs of company officers.

So, if you are the recipient of a delivery up request from an IP, ask yourself is it a reasonable and justified request?  If in doubt then reply to the IP and ask for their reasoning behind the request.

If you need any advice or assistance on any corporate restructuring or insolvency-related issue, then please contact PBC Business Recovery & Insolvency on 01604 212150 (Northampton), 01908 033150 (Milton Keynes), 01234 989150 (Bedford) or email to enquiries@pbcbusinessrecovery.co.uk. Alternatively, visit www.pbcbusinessrecovery.co.uk for further information.

Members’ Voluntary Liquidations – 3 Month Countdown!

Given the recent changes on the rate of CGT that applies to Business Asset Disposal Relief on the lifetime allowance of £1Million, the 3-month clock is ticking to benefit for the current rate of 10% until 5 April 2025 on capital distributions.

The above could be a significant tax saving for you or your clients between now and then and, if this is being considered,  the time to start acting and planning is now.

Should you wish to discuss a Members’ Voluntary Liquidation further  then please contact PBC Business Recovery & Insolvency on 01604 212150 (Northampton), 01908 033150 (Milton Keynes), 01234 989150 (Bedford) or email to enquiries@pbcbusinessrecovery.co.uk.

What does saving 4% mean to you/your clients?

Now the Budget has been and gone we have some certainty, for the next couple of years at least, on the rate of CGT that applies to Business Asset Disposal Relief which is detailed below on the lifetime allowance of £1Million:

  • 10% on disposals until 5 April 2025
  • 14% on or after 6 April 2025
  • 18% on or after 6 April 2026

Should you or your clients be incentivised by the potential saving and would like to explore a Members Voluntary Liquidation, then please contact PBC Business Recovery & Insolvency on 01604 212150 (Northampton), 01908 033150 (Milton Keynes), 01234 989150 (Bedford) or email to enquiries@pbcbusinessrecovery.co.uk. Alternatively, visit www.pbcbusinessrecovery.co.uk for further information.

Are we the best?  PBC let you have your say.

With the unrivalled level of experience available at PBC, we could easily say we are the best people to approach when you are having financial issues, whether that is your own or you are a creditor of someone else suffering a demise.

The fact is, we do not make such claims; we let others express their own opinion such as:

“Gary and his team at PBC are fantastic and they go above and beyond to support you every step of the way through challenging times. Highly recommended. Thank you to Gary and PBC for helping me to get my life back and hopefully some much needed sleep after months of worry.” Director, Northampton

“I can’t recommend Ian enough he’s been amazing with the closing of my business. He reassured and put my mind at ease talking me through step by step and what needs priority etc I didn’t know where to even start but with Ian’s guidance it made everything so much less of a worry to deal with. He was always at the end of the phone if I had any concerns or worries. Making the decision to close your own business is not an easy decision to make but Ian put everything into perspective. I can’t thank you enough Ian for all your help and guidance Thank you.”  Director, Kettering

“Myself and my fellow directors are very grateful for all the assistance Natasha has given as the MVL has progressed. It has all gone far more smoothly than we could have hoped. We definitely made the correct decision when we elected to appoint PBC to act for us”.  Director, Wellingborough

“My financial crisis stirred a myriad of emotions, most of which were negative and soul destroying. Thank heavens for some sound, honest and clear advice which straightened me out and, in reality, showed me it wasn’t half as bad as I thought.”  Director, Rushden

“Good morning Claire, I just wanted to say thank you for the work you have done on the liquidation.   Super efficient and communicative which was greatly appreciated”. Director of a solvent company.

At PBC we recognise the human side of what financial difficulties often create and put that added service into the process to ensure clients are fully aware of the surrounding issues and what they actually mean to them in an easy-to-understand manner.

If you need any advice or assistance on any corporate restructuring or insolvency-related issue, then please contact PBC Business Recovery & Insolvency on 01604 212150 (Northampton), 01908 033150 (Milton Keynes), 01234 989150 (Bedford) or email to enquiries@pbcbusinessrecovery.co.uk. Alternatively, visit www.pbcbusinessrecovery.co.uk for further information.