Dealing with Creditor Pressure

A company can experience creditor pressure as follows:

• Pressure for unpaid liabilities
• Creditors issuing county court judgements CCJ
• Applying for Time to Pay Agreements
• Winding up petitions

These can all take place:

County Court Judgements CCJ

• This is a court order instigated by the creditor to recover an unpaid debt.
• The debt has to be proven at county court before the judgement is issued
• Following receipt of a ccj action should be taken immediately by responding to the court by the date specified
• If you do not believe the debt is due you should ask the court to set aside the judgement
• If you do owe the debt you should pay it back in full or agree on an instalment plan
• If you do owe the debt but are unable to pay it then please contact us for advice
• If the debt is paid within 30 days the CCJ will be removed
• If not it will remain on your credit rating and can affect your ability to obtain credit going forward
• Bailiffs and Court Enforcement Agencies can be instructed to collect the debt

Time to Pay Arrangements

This is when an informal agreement is made with HMRC for an unpaid debt for PAYE, VAT and/or corporation tax

• Usually lasts 6 or 12 months
• Enables a struggling business to repay the liability as it will spread the cost over a period of time
• Is a proactive course of action with HMRC and can decrease the possibility of any enforcement action being taken
• HMRC may refuse if any returns haven’t been submitted, repeat use of a TTP agreement which has been unsuccessful isn’t considered viable by HMRC

Winding Up Petitions

• Formal document to place a company into compulsory liquidation for an unpaid debt
• This will result in bank accounts being frozen
• If you receive a Winding up petition you need to act immediately and take specialist advice

Negotiating with Creditors

• This is an informal way of dealing with debts owed
• Negotiations can take place to repay an individual debt rather than as a whole
• This will be calculated on an affordability basis