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Insolvency


The Council can serve a Statutory demand as a prelude to personal bankruptcy or the liquidation of your company if you do not pay your Council Tax or Business Rates.

Council Tax insolvency

These proceedings commence with the Council serving a Statutory Demand on you.

WARNING:

  • This is an important document. You should refer to the notes below entitled 'How to comply with at statutory demand or have it set aside'
  • If you wish to have this demand set aside you must make application to do so within 18 days from its service to you
  • If you do not apply to set aside within 18 days or otherwise deal with this Demand as set out below within 21 days after its service on you, you could be made bankrupt and your property and goods taken away from you.
  • Please read the demand and notes carefully. If you are in any doubt about your position you should seek advice immediately from a solicitor or your nearest Citizen Advice Bureau.

How to comply with a Statutory Demand or have it set aside (act within 18 days)

If you wish to avoid a bankruptcy petition being presented against you, you must pay the debt, particulars of which are set in the Statutory Demand, within the period of 21 days after its service upon you. Alternatively, you can attempt to come to a settlement with the creditor. To do this you should:

  • Inform the individual (or one of the individuals) named in part B of the Statutory Demand immediately that you are willing and able to offer security for the debt to the creditor's satisfaction, or
  • Inform the individual (or one of the individuals) named in part B of the Statutory Demand immediately that you are willing and able to compound for the debt of the creditors satisfaction.

If you dispute the demand in whole or in part you should:

  • Contact the individual (or one of the individuals) named in part B of the Statutory Demand immediately.

If you consider that you have grounds to have this demand set aside, or if you do not quickly receive a satisfactory written reply from the individual named in part B of the Statutory Demand whom you have contacted, you should apply within 18 days, from the date of service of this demand on you, to the appropriate court shown in part A of the Statutory Demand to have the demand set aside.

Any application to have the demand set aside (Form 6.4 in Schedule 4 to the Insolvency Rules 1986) should be made within 18 days of the date of service upon you and supported by an affidavit (Form 6.5 in Schedule 4 to those Rules) stating the grounds on which the demand should be set aside. The forms may be obtained from the appropriate court when you attend to make the application.

Remember: From the date of service on you of this document

  • You have only 18 days to apply to the court to have the demand set aside, and
  • You have only 21 days before the creditor may present a bankruptcy petition.

Business Rate insolvency

These proceedings commence with the Council serving a Statutory Demand on you.

How to comply with a Statutory Demand.

If the company wishes to avoid a winding up petition being presented it must pay the debt shown on page 1 of the Statutory Demand, particulars of which are set out on page 2 of the notice, within the period of 21 days after its service upon the company. Alternatively, the company can attempt to come to a settlement with the creditor.  To do this the company should:

  • Inform the individual (or one of the individuals) named in part A of the Statutory Demand immediately that it is willing and able to offer security for the debt to the creditor's satisfaction, or
  • Inform the individual (or one of the individuals) named in part A of the Statutory Demand immediately that it is willing and able to compound for the debt to the creditors satisfaction.

If the company disputes the demand in whole or in part it should contact the individual (or one of the individuals) named in part A of the Statutory Demand immediately.

Remember:

The company has only 21 days after the date of service of this document before the creditor may present a winding-up petition.