Businesses can start using winding-up petitions to pursue unpaid debts from next month in the wake of the Covid-19 pandemic. Restrictions imposed during the coronavirus pandemic which prohibited businesses serving winding-up petitions against debtors are set to end later this month.
So, here’s what this means in more detail, and how we at Cobra Financial Solutions provide a comprehensive insolvency service.
Insolvency Protection to Soon End
Businesses can start using the legal instrument of insolvency to pursue unpaid debts this month, however only for debts of more than £10,000 compared with the pre-pandemic threshold of £750.
Despite some restrictions staying place until March, the government have now implemented a minimum limit which, though not ideal, is a significant increase to the original sum; and, given the trials and tribulations of the last 18 months, the new increase is a welcome adjustment.
“The time is right to lift the insolvency restrictions,” said Business Minister, Lord Martin Callanan. Indeed, the extension gives businesses some welcome short-term certainty.
In essence, the changes to the protections come as the government support that consumer-facing industries had relied upon during the pandemic which has now, subsequently tapered away.
What Does Insolvency Entail?
If your debtor fails to pay on demand, and the original amount remains undisputed, they are deemed insolvent. Insolvency action can then be taken against individuals and companies alike.
At Cobra, we aim to ensure that you are the priority creditor. So, once instructed, we work fast. First, we begin to profile your debtor, ensuring that there are no prior petitions held against them. Unless the debt is paid within a set time frame, your debtor is subsequently made aware of your intention to begin insolvency and bankruptcy proceedings.
At the final stage, if the amount remains unpaid, courts often make a bankruptcy order and appoint a trustee to oversee the finances. The result of this is predominantly priority payment.
How Can Cobra Financial Solutions Help?
If you’re feeling overwhelmed by the prospect of entering insolvency proceedings, know that you do not have to go it alone. We at Cobra are here to help and take the stress away from the whole proceedings.
Cobra can take companies as far as liquidation, while we can also take individuals to bankruptcy. Costs vary depending on the work involved in each case as some are more complex
Trust the Debt Recovery Experts
Established in 2009, our specialist team of private debt recovery agents are experts in their field.
With over 75 years’ worth of combined experience, we know that insolvency is a minefield, but we also know how to conduct proceedings accordingly and within the law.
If you are owed money and want to get it back quickly, take decisive action and instruct Cobra today on 0151 526 4222.