New Insolvency Rules

4th April 2017

Liquidation Procedures: New administrative rules being phased in.

With the new tax year already upon us, clients could be forgiven for thinking that all they need concern themselves with are the plethora of new fiscal rules about to impact on their businesses. However, further perhaps overlooked changes are about to be made to insolvency law with effect from 6th April, 2017.

The Insolvency Rules 2016 aim to consolidate over 20 pieces of amending legislation, the main aspects of which are:-

  • Creditors meetings are to disappear unless at least 10 creditors or 10% of the total request one (by number or value). A similar percentage applies to objections to an insolvency office-holder’s proposals.
  • Creditors can opt-out of receiving paper correspondence in favour of electronic communication (which includes voting).
  • Small claims below £1000 can be made without a formal submission provided these are verifiable from accounting records.

 

Further changes are envisaged in relation to a proposed “out-of-court moratorium”, freeing companies from legal action by creditors for 3 months, coupled with a new FRP (Flexible Restructuring Plan) giving priority to the provision of fast turnaround finance.

The overall aim is to cut costs and hence raise dividend distributions to creditors, and also to improve the chances of business recovery.

Blog entry by: Chris Morton

Related Services

Business Turnaround
Other items in Blogs
Millie Hunt
4th July 2022 Covid: Could you claim for business interruption?

  If your business was adversely impacted by the coronavirus pandemic, then you may wish to consider whether your insurance covered you for business interruption – as you could be due an insurance pay-out in relation to your loss of earnings. When calculating your loss of earnings, there are a number of factors that you…

Vanessa Pearson
1st July 2022 R&D Tax credit repayment delays

The Chartered Institute of Taxation (CIOT) has been asked by HMRC to share the message below about the recent pausing of Research & Development Tax Credit (RDTC) payments with their members.   Message from HMRC: “We previously notified agents that we have paused some Research & Development Tax Credit (RDTC) payments while we investigate an increase…

Joe Fretwell
1st July 2022 Is your PAYE code correct?

With the rising cost of living, it has never been more important to ensure you are paying the correct amount of tax through your PAYE tax code. It is important to understand your tax code, any changes to this and why your tax code on your payslip is what it is. There are many reasons…

Ruth Pearson
23rd June 2022 Changes to National Insurance

In April 2022 we saw Employee’s National Insurance Contributions increase by 1.25% from 12% to 13.25%, as part of the Governments Health and Social Care levy. Employer’s National insurance also increased from 13.8% to 15%. From April 2023, the health and social care levy will be paid separately to National Insurance and become a tax…

James Selby
23rd June 2022 Pensions Contributions: Maximise tax relief

We are seeing more and more cases of individuals missing out on claiming higher rate tax relief on their employee pension contributions especially where they are not in self-assessment and required to file tax returns.   Where employers have enrolled their staff to make employees pension contributions via a ‘relief at source’ scheme, the contributions…

Paul Jefferson
14th June 2022 VAT Penalty Changes

A new penalty regime will come into effect for VAT periods starting on or after 1 January 2023. The changes will impact the charges for missing VAT filing and payment deadlines and will be replacing the current surcharge system. These changes place continued importance on being up to date with your VAT returns, aware of…