If you or your company owe more than £5,000 in council tax or business rates, and a liability order has been granted, we may start bankruptcy or liquidation proceedings against you. First, we will serve a statutory demand for the amount you owe, which will give you 21 days to settle the debt. If you or your company receive a statutory demand, you should contact us immediately. If you do not pay the amount shown on the statutory demand within 21 days, we will present a petition for bankruptcy or liquidation to the high court.
If a bankruptcy order is granted against you, this will mean that:
- 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
- you could be forced to sell your home or other assets to pay your debts.
If you are made bankrupt, the official receiver may control your spending for up to three years.
If your company is placed into liquidation, this will mean that:
- you may be disqualified from being a company director
- your company will be wound up by the official receiver
- your company's assets will be seized and sold to pay for its debts or
- your personal bank accounts could be frozen.
Do not ignore a statutory demand.