Will Business Insolvency Cost Me Anything?

The answer to this is it depends both on the complexities involved, creditors and insolvency practitioners hired to deal with the process. Insolvency should never be seen as an easy option as a result of the many variables that need to be considered first.  

Potential fees for a business going insolvent might include the costs charged by an insolvency practitioner a percentage of realisations and in some cases a fixed fee.  

Unless the insolvency process is a company voluntary arrangement (CVA) an insolvency practitioner will have the task of coming up with a fee budget and submitting this to creditors for their agreement. This effectively means any costs will be capped and the only way they can charge more than the agreed sum would be to ask creditors for their approval.  

Naturally an insolvent business is going to have cash flow issue that may make it difficult to pay the costs involved in insolvency but the insolvency practitioner can look at areas such as outstanding invoices, equipment and machinery and even equity in a house.  

If these assets are insufficient then an agreement will need to be made to give company owners more time to pay.