A bespoke free service for FSB members... When is the right time to take insolvency advice for your business?

Working closely with the FSB we are pleased to be able to offer members a free initial insolvency assessment by telephone. It only takes ones of our experienced advisors 30 minutes to understand and assess your situation and point you in the right direction.

After that if you would like a more detailed review again for no charge we can do that too. If you are concerned, don’t delay, we are here to help.

If you are a small business looking for insolvency advice call 0800 331 7410

When should I approach an insolvency practitioner?

The Covid-19 pandemic is taking its toll on people and businesses alike and in its train many small businesses will be touched by insolvency issues for the first time. In normal times most business owners think insolvency is something that only happens to other businesses but that might all be about to change.

Did you know that your business is defined as insolvent by law if the value of its assets is less than the amount of its liabilities OR it cannot pay its debts as they fall due? If either apply you should take insolvency advice.

Are there any warning signs I should look out for?

Think of insolvency warning signs like a traffic light.


Carry on trading but keep under review
  • Unable to pay creditors on normal terms but they are happy to extend further credit.
  • Cannot pay the tax man on time but HMRC has agreed a payment schedule for the arrears.
  • Exceeded your credit limits with your key suppliers and are on stop but able to get credit elsewhere and overall keep your creditors level.


Proceed with caution
  • You can only get credit from new sources and are using this to fend off existing creditors.
  • Creditors are threatening legal action and tax arrears are mounting.
  • You cannot accept new orders because you cannot buy essential materials or pay the overtime to satisfy it.


Stop trading or take professional advice
  • You are on stop with most of your suppliers and cannot get more credit from anywhere.
  • You are receiving final demands for payment and county court writs.
  • The worry is giving you sleepless nights.

How can we help?

  • If your business runs out of cash
  • If you are thinking of injecting emergency funding or giving a last chance PG
  • Before your business is run into the ground
  • Long before you unintentionally do anything that would give rise to director misconduct and disqualification
  • If business pressures are getting you down
  • If in doubt … we are here to help

Don’t be nervous talking to an insolvency practitioner, if you’re worried you might be losing control contact us early, there’s more scope when people call us early as we’re able to offer turnaround possibilities. McTear Williams & Wood has 20 years’ experience working as a leading business rescue and insolvency expert. Contact one of our professional experts today.

Business rescue and insolvency options...Helping FSB members through difficult times

We summarise some of the available options and must stress that we always exhaust the business rescue options before we get to the insolvency route. Below is a brief run through of each option in the order of least intervention first. Think of these as a cascade where we rule each one in or out in turn.

Business rescue and insolvency options ... Rule of six:

Trade on and out
  • Prevention is better than cure
  • Most businesses have to juggle cash flow
  • Decline is often … slow … slow … rapid!
  • Cut costs early and hard
  • Be realistic with 12 month integrated financial forecasts and 12 week rolling cashflow
  • Introduce last chance director/shareholder funding safely
  • Record the reasons for key decisions and follow professional advice
Informal TTPs
  • If creditors are not paid as they fall due then your company is insolvent
  • If you pay within agree extended credit terms then … your company is solvent
  • Reschedule loan/finance repayments
  • HMRC TTP proposals
  • Current arrears only
  • Spread over a realistic period … but <12 months
  • Include an initial payment on acceptance
  • Keep to it!
New moratorium
  • On the cards since 2016 but introduced on 26 June 2020

  • No legal action for 20 days

  • Can be extended by up to 12 months

  • Company has to be unable to pay its debts

  • Monitor (who has to be an IP) oversees the process who has to state:

  • Company is likely to be rescued

  • Has cash flow to pay future liabilities and ongoing finance costs

  • If no monitor must bring the moratorium to an end



  • Introduced in 1986 but got off to a slow start
  • Can be used for:
  • Voluntary contributions (typically over five years)
  • Buy time
  • Orderly wind down
  • Best known for large retail and casual dining businesses
  • A significant percentage fall
  • Introduced in 1987 but became mainstream in 2003

  • Includes a moratorium to helps keep the business intact

  • Directors usually appoint the administrator but often at the behest of a lender

  • The most common type is the so called “pre-pack”

  • Costly so only suitable for larger businesses

  • Ends with dissolution or liquidation

  • Introduced in 1800s
  • Used when a company cannot continue to trade and needs to be wound up
  • Members voluntary liquidation
  • Voluntary liquidation voluntary liquidation
  • Compulsory liquidation liquidation voluntary liquidation
  • Arguably superseded Administration as a business rescue procedure

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