{"id":12384,"date":"2023-07-06T06:32:55","date_gmt":"2023-07-06T06:32:55","guid":{"rendered":"https:\/\/www.theukrules.co.uk\/?page_id=12384"},"modified":"2023-09-23T04:46:38","modified_gmt":"2023-09-23T04:46:38","slug":"compulsory-liquidation","status":"publish","type":"page","link":"https:\/\/www.theukrules.co.uk\/rules\/business\/closing-down\/liquidate-a-company\/compulsory-liquidation\/","title":{"rendered":"Compulsory Liquidation | Apply to the Court for Winding Up"},"content":{"rendered":"<p><strong>COMPULSORY WINDING UP<\/strong>: This type of <a href=\"\/rules\/business\/closing-down\/liquidate-a-company\/\">company liquidation<\/a> is also called &#8216;compulsory liquidation&#8217;. Before you can wind up a company the court will need to see:<\/p>\n<ul>\n<li>That the business is unable to pay its debts of at least \u00a3750.<\/li>\n<li>That 75% of the company shareholders (by value of shares) agree to the court winding up the company.<\/li>\n<\/ul>\n<p><strong>Note<\/strong>: To close a company by compulsory liquidation it must carry out the majority of its business in England, Scotland, or Wales. But, the actual base for the business can be anywhere.<\/p>\n<p><\/p>\n<hr>\n<p><\/p>\n<h2>How to Apply Directly to the Court<\/h2>\n<p>The first step in the process is to download &#8216;<a href=\"https:\/\/www.gov.uk\/government\/publications\/apply-to-wind-up-a-company-that-owes-you-money-form-comp-1\" target=\"_blank\" rel=\"noreferrer noopener\">Form Comp 1: Winding-up petition<\/a>&#8216;. Use this document to apply to the court to close or wind up a company if it cannot pay its debts. Fill in form Comp 1 and send it to the court along with:<\/p>\n<ul>\n<li><a href=\"https:\/\/www.gov.uk\/government\/publications\/confirm-details-of-a-winding-up-petition-form-comp-2\" target=\"_blank\" rel=\"noreferrer noopener\">Form Comp 2<\/a> &#8216;Verification of the petition&#8217; which confirms the details of a petition.<\/li>\n<li>The winding-up resolution agreed by the shareholders.<\/li>\n<\/ul>\n<p>The &#8216;paid-up share capital&#8217; amount determines where you should send the winding-up petition. You may need to <a href=\"https:\/\/beta.companieshouse.gov.uk\/\" target=\"_blank\" rel=\"noreferrer noopener\">search Companies House register<\/a> to confirm company paid-up share capitals.<\/p>\n<p><\/p>\n<hr>\n<p><\/p>\n<h2>Paid-up Share Capital \u00a3120,000 (or more)<\/h2>\n<p>You can submit the petition online if the company paid-up share capital is \u00a3120,000 or higher. Using <a href=\"https:\/\/beta.companieshouse.gov.uk\/\" target=\"_blank\" rel=\"noreferrer noopener\">HM Courts &amp; Tribunals E-Filing Service<\/a> means it gets sent to the High Court.<\/p>\n<p><\/p>\n<hr>\n<p><\/p>\n<h2>Paid-up Share Capital Less than \u00a3120,000<\/h2>\n<p>If the capital is under \u00a3120,000 you will need to <a href=\"\/rules\/legal\/courts\/\">search for your nearest court<\/a> that deals with bankruptcy.<\/p>\n<p><img decoding=\"async\" style=\"float: right\" src=\"\/wp-content\/uploads\/2023\/06\/compulsory-liquidation.jpg\">When you find it, you can submit the form petition online if it happens to be any of these:<\/p>\n<ul>\n<li>Admiralty and Commercial Court<\/li>\n<li>Chancery Division<\/li>\n<li>Companies Court<\/li>\n<li>High Court (includes Bankruptcy Court)<\/li>\n<li>London Mercantile Court<\/li>\n<li>Rolls Building<\/li>\n<\/ul>\n<p><strong>Note<\/strong>: The petition will need submitting by postal methods if it was not one of these courts.<\/p>\n<p><\/p>\n<hr>\n<p><\/p>\n<h2>Fee for Compulsory Liquidation<\/h2>\n<p>There are several costs to pay when you apply directly to the court to liquidate a company:<\/p>\n<ul>\n<li><strong>\u00a31,600<\/strong>: The fee for submitting the petition.<\/li>\n<li><strong>\u00a3302<\/strong>: The fee for the court hearing.<\/li>\n<\/ul>\n<p>The court will respond to you after you apply. They will send you a date for the hearing &#8211; providing they accept your petition. There are several steps to take before the court hearing takes place, including:<\/p>\n<ul>\n<li>Serving a copy of the petition to the company. You must let the court know you did this by filling in a &#8216;<a href=\"https:\/\/www.gov.uk\/government\/publications\/form-n215-certificate-of-service\" target=\"_blank\" rel=\"noreferrer noopener\">Certificate of Service form N215<\/a>&#8216;.<\/li>\n<li>Placing a <a href=\"https:\/\/www.thegazette.co.uk\/place-notice\" target=\"_blank\" rel=\"noreferrer noopener\">notice in The Gazette<\/a> at least 7 days before the hearing goes ahead.<\/li>\n<li>Sending a copy of the Gazette advert and the Certificate of Service to the court.<\/li>\n<\/ul>\n<p><\/p>\n<hr>\n<p><\/p>\n<h2>Attending the Court Hearing<\/h2>\n<p>If you choose to attend the court hearing there is no need for you to give any evidence. But, if you choose not to attend, then your solicitor must go instead.<\/p>\n<p>The court will assign an official receiver if they grant a winding-up order. The main responsibility of the liquidator will be liquidating the company. The court will also send a copy of the winding-up order to the registered office of the company.<\/p>\n<p><strong>Note<\/strong>: The role and responsibilities of a director change after the compulsory winding up of a company.<\/p>\n<p><\/p>\n<hr>\n<p><\/p>\n<div class=\"content-inner-block\">\n<h4>ALSO IN THIS SECTION<\/h4>\n<p>  <a href=\"\/rules\/business\/closing-down\/liquidate-a-company\/\">Liquidate a Company<\/a>: The key aspects to consider when liquidating your limited company.<br \/>\n  <a href=\"\/rules\/business\/closing-down\/liquidate-a-company\/\">Creditors&#8217; Voluntary Liquidation<\/a>: CVL involves creditors because the company cannot pay its debts.<br \/>\n  <a href=\"\/rules\/business\/closing-down\/liquidate-a-company\/directors-after-liquidation\/\">Directors after Liquidation<\/a>: Find out what happens to company directors after appointing a liquidator.<br \/>\n  <a href=\"\/rules\/business\/closing-down\/liquidate-a-company\/members-voluntary-liquidation\/\">Members&#8217; Voluntary Liquidation<\/a>: MVL is the members&#8217; agreement to liquidate a solvent company.<br \/>\n  <a href=\"\/rules\/business\/closing-down\/liquidate-a-company\/\">What Does a Liquidator Do?<\/a> A liquidator is the official receiver who conducts the liquidation process.<\/p>\n<\/div>\n<p><\/p>\n<hr>\n<p><\/p>\n<div class=\"updated-data\"><strong>Compulsory Liquidation: Apply Directly to the Court to Liquidate an Insolvent Company<\/strong><br \/>\n  <time datetime=\"2022-01-01\">Last Updated 2022<\/time>\n<\/div>\n","protected":false},"excerpt":{"rendered":"<p>COMPULSORY WINDING UP: This type of company liquidation is also called &#8216;compulsory liquidation&#8217;. Before you can wind up a company the court will need to see: That the business is unable to pay its debts of at least \u00a3750. That 75% of the company shareholders (by value of shares) agree to the court winding up&hellip; <a class=\"more-link\" href=\"https:\/\/www.theukrules.co.uk\/rules\/business\/closing-down\/liquidate-a-company\/compulsory-liquidation\/\">Continue reading <span class=\"screen-reader-text\">Compulsory Liquidation | Apply to the Court for Winding Up<\/span><\/a><\/p>\n","protected":false},"author":2,"featured_media":0,"parent":2086,"menu_order":0,"comment_status":"closed","ping_status":"closed","template":"","meta":{"inline_featured_image":false,"footnotes":""},"acf":[],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v22.2 - https:\/\/yoast.com\/wordpress\/plugins\/seo\/ -->\n<title>Compulsory Liquidation | Apply to the Court for Winding Up - UK Rules<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/www.theukrules.co.uk\/rules\/business\/closing-down\/liquidate-a-company\/compulsory-liquidation\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Compulsory Liquidation | Apply to the Court for Winding Up - UK Rules\" \/>\n<meta property=\"og:description\" content=\"COMPULSORY WINDING UP: This type of company liquidation is also called &#8216;compulsory liquidation&#8217;. 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