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Est. 1989

How Does Company Administration Work?

Licensed UK Insolvency Practitioners FREE Meeting for Company Directors

We can help with serious company debts, HMRC and creditor pressure, VAT/PAYE/Tax arrears, cashflow problems and raising finance.

How Does Company Administration Work?

We owe money on our office mortgage, credit cards, and a startup loan that we’ve been trying to pay off for several years. Despite this we still have plenty of equipment and inventory that we can sell to come up with the funds needed to break even, but we don’t know if we’ll be able to continue operating successfully while eliminating some of our existing debts. We’ve been told that appointing an administrator might help us liquidate some assets to be debt free again.  If we were to enter administration voluntarily how would the process work?


Making the decision to enter administration can be a tough one, especially if you’re not sure what the outcome will be. When an insolvency practitioner is appointed as the administrator of a company by its directors, the goal is usually to do whatever is necessary to preserve the business whilst making sure creditors are not prejudiced.

All control of the business operations are relinquished to the administrator. The company is protected from all legal action while the administrator executes the plan proposed at the official creditors’ meeting.

You can rest assured that if an insolvency practitioner recommends a voluntary administration then it is highly unlikely that the outcome would be negative in comparison to alternative routes, as we’re required by law to pursue the most suitable plan of action taking account of the interests of all stakeholders.

Creditors who hold security in the form of a debenture may be able to place your company into administration if you fail to meet a demand for payment or if the loan agreement terms contain a provision that allows for express appointment of an administrator.

In other circumstances if the company is able to repay most of its debts and/or come to an agreement with creditors, typically through a CVA, then the business  may be restored to solvency and could continue trading as normal. However, if the administrator believes that recovery is not a realistic option, they may recommend other options.

Who we help

  • Company Directors
  • Finance Directors
  • Sole Traders
  • Accountants
  • Small Businesses
  • Large Businesses
  • Partnerships

Contact our team

Jonathan Munnery
Andrew MacKenzie
Julie Palmer
Thomas Mckay
Keith Tully
or Find your Nearest Office

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