Four recent changes to the insolvency regime

Published on October 20, 2015 by Crawfords Accounting

Recent weeks have seen four major changes made to the regime surrounding personal and corporate insolvency, which R3 – the Association of Business Recovery Professionals summarised in a series of tweets.

At the start of October, the organisation’s press office tweeted: “Lots of changes to the insolvency regime … bankruptcy, Debt Relief Orders, fees and business rescue all being updated.”

They went on to outline each change in more detail:

Fees

Corporate insolvency fees will now be estimated upfront, so an insolvent company’s creditors can see what work is due to be carried out by the insolvency practitioner.

Any fee-paying work above this must be approved by the creditors, otherwise no additional fees may be paid to the IP.

Bankruptcy

A major change to the bankruptcy limit saw the £750 minimum threshold to declare bankruptcy – which had remained unchanged ever since 1986 – raised substantially to £5,000.

The move means fewer personal insolvents should be forced into bankruptcy by their creditors, and corrects the oversight of the threshold not being linked with inflation.

Business Utilities

A campaign by R3 themselves has led to a change in the way business utilities are supplied during a period of corporate insolvency.

Suppliers are now not allowed to cut off insolvent business customers, as long as they are still trading as part of a corporate recovery attempt.

Debt Relief Orders

Finally, Debt Relief Orders, a less punishing form of personal insolvency than bankruptcy or even individual voluntary arrangements, have been given wider scope.

You can now enter into a DRO with anywhere up to £1,000 of assets and £20,000 of debt – up from £300 of assets and just £1,000 of debt before.

Together, all of these changes have given more security to personal and corporate insolvents alike – whether by making insolvency methods more available, or by protecting essential supplies while corporate recovery is in progress.

We have received an excellent service from the team at RPG for well over 20 years. We particularly appreciate RPG's real interest in our company and suggestions for improvements. The service RPG provides goes well beyond what we could expect.  The attention to detail and the prompt, professional service the team provides means that we are reassured that should we require urgent or unusual advice, the team will provide it. We would have no hesitation in recommending RPG.

Margaret Peasegood

Executive Chairman - SheffProp

I would like to thank RPG for your unbelievable help, assistance and friendship for over 40 years. Nothing has ever been too much trouble. Words alone are insufficient, and I think that the same would apply to my former colleagues and my family who have also come to rely on your advice and guidance.

Neville Johnson

Founder - Neville Johnson Offices

We have worked with RPG for many years, for good reason. They are not only extremely knowledge but they really take the time to get to know you as customers and also as people. This really makes a difference, as whilst it is of course important that you receive great service, which we do, it’s also essential to work with professionals who you can really trust and who go out of their way to know your business as well as you do, giving ultimate comfort that you are all striving towards the same goals. I cannot recommend them highly enough.

Jennie Johnson MBE

Kids Allowed

“RPG have always been our first point of call for advice on accounting, tax and financial regulatory matters and indeed have become an additional sounding board for both myself and my colleagues on strategic matters. The consistently high quality and timely advice they provide is very important to us.”

Gareth Rowe

Chief Financial Officer - ProofID

“As a family business we have been using Royce Peeling Green as our accountants for over 25 years. We have always been impressed with their expertise and depth of knowledge in all financial areas required to help run our business. There is an obvious understanding and trust between the two companies which leads to proactive approach to guide us with short and long-term financial planning. We have found everyone at Royce Peeling Green to be very approachable providing us with the reassurance that they will always provide a professional response in a timely manner.”

David Harrabin

Managing Director - Manchester Slate Ltd

RPG have now acted for our various companies for over 15 years. Their advice and commercial attitude in dealing with Tax, Audit and general businesses matters has always been of high quality and queries dealt with promptly. The team at RPG are experts in their field, they understand the SME market place well. They have been involved in all our corporate transactions, from setting up of businesses, ongoing support of our management teams through to being part of the team that negotiated the successful sale of a group company.

Jonathan Hamburger

Genesis Group International

We have received a first rate service from RPG over many years. We appreciate their attention to detail and the timely, professional and pro-active advice they provide. We would have no hesitation in recommending the team at RPG.

Stephen Rector

Managing Director – Ribble Packaging Limited

  • LinkedIn
  • Twitter