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Winding Up Petitions. What Are They?
A Winding Up Petition really is the most severe threat that a Creditor can issue to your company. Chances are that you may have received a Winding Up Petition from HMRC or another Creditor. If this is the case the Creditor is looking to force the business into compulsory liquidation.
Any Creditor that is owed £750 or more can apply for a Winding Up Petition to be processed against the company in question.
Generally a Winding Up Petition can cost anything between £300-£800 to issue and then a court deposit is required which is in excess of £1,100 so it is clear that the creditor that has issued the Winding Up Petition intends to follow through with this process given the cost they will incur.
As always you should manage your company correctly but when the company receives a Winding Up Petition it is even more important that you fully address all of your resposibilities as a Director of the company. The reason Directors must be make sure their duties are fully addressed when a Winding Up Petition is received is because they can be left open to accusations of Wrongful Trading if the Insolvent company is mis-managed. If Directors are found guilty of Wrongful Trading they can be made personally liable for company debts.
If the Winding Up Petition is heard at court and you do not respond or come back with a defense then the Winding Up Petition is made into a Winding Up Order, at which point the company will be forced into compulsory liquidation.
To clarify, after receiving a Winding Up Petition the Directors should act quickly and resposibly to ensure they are protected as much as is possible.
If you have received a Winding Up Petition please take the time to get in touch straight away and we will be able to advise on what to do next.
Call: 08000 842 844
