Bankruptcy and liquidation

Bankruptcy and liquidation

Council tax fact sheet

If you, or your company, owe more than £750 in council tax or business rates, and you have been summonsed, we may start bankruptcy or liquidation proceedings against you. 

First, we will send you a statutory demand which will give you 21 days to pay us the full amount. 

If you, or your company, receive a statutory demand, you should contact us immediately. 

If you do not settle the statutory demand, we will present a petition for bankruptcy or liquidation in the high court. 

If we issue a bankruptcy order against you, this will mean: 

• the official receiver will investigate your affairs;
• your bank accounts will be frozen;
• you will lose your credit rating and be blacklisted from getting any more credit; and
• you could be forced to sell your home to pay your debts.         

If you are made bankrupt, the official receiver will control your spending for three years. 

If a liquidation order is granted against your company, this will mean: 

• you will not be allowed to be a company director;
• your company will be wound up by the official receiver;
• your personal bank accounts could be frozen; and
• you could be forced to sell your home.         

Do not ignore the statutory demand.

Ways to contact us about council tax