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Compulsory Liquidation

We understand that being involved in a liquidation is a uniquely stressful and highly pressurised situation. We guide our clients through the process and aim to use our experience to limit the impact on them as much as possible.

Compulsory Liquidation Litigation Lawyers

We are able to offer an extensive range of insolvency litigation services to:

  • Individuals
  • Companies

Our team of insolvency lawyers is experienced in advising in relation to a wide range of matters including:

  • Transactions defrauding creditors
  • Transactions at an undervalue
  • Wrongful Trading | Fraudulent Trading
  • Preferences
  • Removal or replacement of liquidators
  • Misfeasance claims against company directors
  • Director disqualification

Got a question?

Can't find what you need? Get in touch with our experience team, who are happy to answer any questions you have. Call us on 0333 370 4333.

What is a compulsory liquidation?

A compulsory liquidation usually occurs as a result of the presentation of a Winding Up Petition to the court by a creditor against a company that is unable to pay its debts.

The liquidation of the company is ‘compulsory’ as opposed to ‘voluntary’ and requires a court order.

Whilst it is usually a creditor that petitions for the winding up of a company, other parties can also present a winding up petition, including the Secretary of State, on the ground that it is in the public interest to wind up the company.

What is the procedure for a compulsory liquidation?

Following the issue and service of a winding up order, if the court orders the winding up of a company, the immediate steps to be taken are:

  • A liquidator must be appointed
  • The company must cease to trade immediately

Subsequent steps in the process include:

  • The Official Receiver will notify Companies House of the Winding Up Order
  • A decision will be taken by the Official Receiver and the company’s creditors on whether or not to:
  1. Appoint an Insolvency Practitioner as liquidator in place of the Official Receiver, and
  2. Appoint a liquidation committee to assist the Insolvency Practitioner. The committee will generally consist of three or five members who are creditors of the liquidated company

There are strict time limits for appointing an Insolvency Practitioner and for convening the initial liquidation committee meeting.

The liquidator’s fees will be paid using the company’s funds/assets before such funds/assets are distributed to creditors. Such fees will be approved by the liquidation committee.

In addition to marketing and selling the assets of the company to achieve a distribution of cash to the company’s creditors, the liquidator will also focus attention on investigating the activities of the company and its directors and prepare a Liquidator’s Report. This will include interviews with appropriate company personnel and access to all company books and records.

All creditors will need to submit ‘Proof of Debt’ to evidence that funds are owed to them by the liquidated company.

The liquidator will provide both a Statement of Affairs of the company and details of the liquidation committee to Companies House.


What happens once assets are liquidated?

Having liquidated all assets and made the appropriate distribution to the company’s creditors, the liquidator will prepare the Final Account for the approval of the company’s creditors. If approved, it will be submitted to Companies House so that the company can be officially dissolved.

Both HMRC and the Secretary of State for Business Energy and Industrial Strategy may have an interest in conducting their own review of the company and its directors which can lead to separate criminal or civil proceedings in many cases.

How can KANGS help?

Our team of expert lawyers is here to guide you in relation to any issues concerning winding up petitions and compulsory liquidations.

We are happy to provide an initial no obligation consultation at our offices in London, Birmingham or Manchester or via video conferencing facilities to explore the issues in your case and to provide an assessment of how we can assist you.

Contact KANGS

The expert lawyers at KANGS are available to assist you. We can arrange initial consultations in person, by video call or telephone.

Please contact one of our experts listed below or contact us at:


T: 0333 370 4333



The quality of the work and advice is outstanding. They provide a real cradle-to-grave service and they make sure their client’s case is well fought.
An acute attention to detail and a tenacity that clients really rate are features of this firm.
The team has substantial expertise in multi-jurisdictional financial regulatory investigations.
The lawyers are known for providing a very personal service from specialist and experienced Partners.
It has very bright individuals at all levels who know the system inside out.
Superior firm with that rare quality of being client centred and commercial at the same time and without detriment to either.
Particularly active in high value financial fraud cases.
The team is intelligent, hardworking and determined to do a professional job
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