You'll normally instruct a solicitor to prepare and submit the winding-up petition. You must be able to:
- prove the company owes more than £10,000 (to one or more creditors)
- prove the company cannot repay what they owe
You can prove that a company cannot pay its debts using any of these reasons:
- the company does not comply with a 'statutory demand' served on behalf of a creditor owed over £750 within 3 weeks
- a creditor obtains judgment against the company and there are not enough assets or funds to clear the debt (the ‘execution is unsatisfied’)
- the company cannot pay its debts when they are due
- the company's total debts are more than its total assets
A statutory demand is a formal request for the debt to be paid.
You can choose to use the template statutory demand from the Accountant in Bankruptcy's website. This template is a guide only, its use is not mandatory. There may be additional content prescribed in legislation which you must include. Your solicitor may also have a template and can help you complete it with all of the information required.
You can petition the court if the company:
- does not respond to the statutory demand within 21 days
- breaks a written promise to pay the debt
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