End to rules on the use of winding up petitions

The Government has now brought to an end the previous temporary restrictions surrounding a creditor’s ability to present a winding up petition against a corporate debtor.

 Under previous restrictions, a creditor was only able to present a winding up petition against a corporate debtor where:

• The debt was for a liquidated amount, which had fallen due and was not an ‘excluded debt’
• The debtor had been given written notice of the debt and an opportunity to provide repayment proposals for that debt
• 21 days had lapsed since the debtor was given notice and no satisfactory repayment proposals had been provided to the creditor
• The debt was for at least £10,000 (or for a combined total of at least £10,000 if multiple debts were due from the same debtor)

These restrictions came to an end of 31^st March 2022.  As such, from 1^st April 2022, it is once again possible for winding up petitions to be issued against a corporate debtor for debts that exceed only £750 and it will not always be necessary for prior notice to be given to the petitioned company.

For further information on insolvency law related issues please contact our Business Services Team on 01908 660966 / 01604 828282 or by email info@franklins-sols.co.uk.