Christmas is creeping up, for many a time of joy, but for some a time of dread and debt… the...
“How much will I pay for my company’s insolvency?”
This is a fair question but, as you might expect, the answer depends on a number of factors.
It’s unlikely you’ll need to engage the services of an Insolvency Practitioner more than once, so you’re likely to have no experience of what our service involves. We know how uncomfortable uncertainty can be and if you’re in need of us, you already have plenty of that to deal with.
Because of the sensitive nature of the job we do, the work of all Licensed Insolvency Practitioners is regulated very strictly.
The UK’s licensed insolvency industry is amongst the most efficient and best value in the World. So you can be reassured by the industries’ comprehensive codes of practice and significant legislation, that as licensed Insolvency Practitioners we’re held to the highest standards of fairness and transparency in everything we do. We are regulated by Insolvency Practitioners Association and our code of ethics can be found at Lines Henry Code Of Ethics
Perhaps the question of ‘who pays’ is a more pressing concern?
For the most part, the insolvent company itself will pay the Insolvency Practitioner’s fee, not the company Director, so there’s little need to worry about our fee coming out of your own pocket. Instead, the realised assets of the company will be used to pay for our services.
The basis of the fees to be paid is agreed by creditors after they have received a written proposal from the insolvency practitioner. This proposal is sent to creditors in the early stages of an insolvency. The creditors themselves vote to accept or decline this proposal. This will, of course, reduce the available funds to repay them, so in effect, it is the creditors who end up paying for our services and the nature of the process means that they must agree to this before any fees can be drawn.
It’s a bespoke service
Every company is different, so every insolvency is also different. With this being the case, some insolvencies will be very straightforward, some extremely complex, with the majority falling somewhere in the middle. The fees we charge are tailored to the work that we expect to have to carry out.
Additionally, an Insolvency Practitioner can take one of many different roles depending on the action taken to deal with the insolvency, so it’s impossible to assess the likely cost of an insolvency without an assessment of the business concerned.
No insolvency practitioner will be able to propose a fee until they know more about the business and the circumstances they’re dealing with.
We do, however, offer a free consultation, so the first stage of taking action won’t cost you anything and part of that consultation will involve a discussion about fees. The sooner we’re involved, the better the outcome. Delay is likely to be far more expensive than our fee.
The best outcome is our primary consideration
Insolvency isn’t automatically the end of a business but it can be if problems are left for too long before they are dealt with. The first thing an insolvency practitioner will do is try to save a business in difficulty. Returning a company to solvency is the absolute best outcome, it saves the business, preserves jobs, gives creditors the best chance of being paid and gives them the option of retaining a customer too.
If the business can’t be saved, our focus switches to getting the best possible prices for disposed assets, recovering monies owed from debtors and overall, repaying as much to the creditors as possible.
In either circumstance, we’ll use our significant knowledge and experience to make sure, that at the end of the process, we’ve done everything within our power to secure the most favourable outcome possible for all parties.
Get in touch with us to discuss your circumstances. The sooner we’re involved, the sooner we can help.