Frequently Asked Questions

How do I get my money back from an insolvent business or individual?

In an insolvency, it’s not always possible to get all or, sometimes, any of your money back – the business or individual has entered an insolvency process for a reason.

To increase your chances of seeing at least some money back though, you should co-operate as much as possible with the office holder that has been appointed to work with the insolvent business or individual by whom you are owed money. The office holder is on your side: they are there to make sure as many debts as possible are repaid.

The more information you provide the office holder, the better: you should tell them as much as you can about the debt you are owed, and all that you know about the business or individual going through the insolvency process.

This microsite contains further information on how to get involved. The helpsheets will help you navigate the insolvency process too.

I’m a creditor and have not received any money from an insolvent company or individual – however the insolvency practitioner has. Why?

The insolvency practitioner is a professional person who will need to be paid a fair fee for the work they will be doing to help you and dealing with the formalities of the winding up of the insolvent company or individual. This is subject to approval from creditors. There is very often not enough money or other assets left in an insolvent company or individual’s possession to pay all creditors back all that they are owed.  Because of this, the government has created an Order of Priority that determines the order in which costs and claims are paid.  You can read more here.

Another creditor has been given a better deal by the insolvency practitioner. Why?

As noted above, when there’s no enough money to pay everyone in full, costs are claimed an order of priority.

How do I complain about an insolvency practitioner or an Official Receiver?

It’s a good idea to try to resolve your complaint with the insolvency practitioner or the Official Receiver first.  It’s likely to be resolved satisfactorily and more quickly.  If you are still unhappy with the service they’ve provided you can find the details of how to make a complaint here.

How do I contact an insolvency practitioner?

If you need to speak to an insolvency practitioner regarding an individual insolvency, you can find out their contact details on the Insolvency Service's Individual Insolvency Register  or the Register of Insolvencies in Scotland. For a corporate insolvency, you should check the Gazette.

I’m not happy with the insolvency practitioner/Official Receiver handling a case where I am a creditor – can I change the insolvency practitioner/Official Receiver?

It is possible to change the insolvency practitioner or ask for a case being handled by the Official Receiver to be passed to an insolvency practitioner.

In compulsory liquidation and bankruptcy there is the possibility for creditors to appoint an insolvency practitioner of their choice but this requires either the majority of creditors by value; or 25% of creditors ask for a decision procedure to take place to replace the Official Receiver as liquidator or trustee.  

I know a director of an insolvent company or an insolvent individual is hiding assets. What do I do?

It’s important that you tell the insolvency practitioner handling the case about any concerns you have regarding a director’s or individual’s conduct. You can find out which insolvency practitioner to contact using the Insolvency Service’s Individual Insolvency Register or the Register of Insolvencies in Scotland, or the Gazette.

How long will the insolvency take to sort out? How long do I have to wait to get my money back?

On average, insolvencies in the UK take about a year to resolve. However, each case is unique so some cases might take a lot longer to sort out; cases can be completed in less than a year too. Always speak to the insolvency practitioner or Official Receiver handling a case to keep up to date with what’s happening.

I don’t have time to get involved in the insolvency procedure – can someone do this on my behalf?

You can appoint a proxy to act on your behalf. You can find out how to do this here.

I bought some items on a credit card / debit card from a retailer but the business went insolvent before delivering them to me.  What can I do?

Where a retailer has become insolvent before delivering goods or services, check the insolvent retailer’s website for help on what to do.  The office holder should have placed a notice on the website which will explain whether or not there is a possibility of pre-paid goods still being supplied and what to do to do if it isn’t expected that the goods will be delivered.  You may be able to get your money back by claiming a refund from your card issuer.  If the retailer did not have a website, have a look at the former shop window for a notice or find out who the appointed office holder is and contact him or her for advice.

I have a voucher to use with a business which is now insolvent. Am I a creditor?

This very much depends on the particular insolvency. Whether or not vouchers are accepted by a business in an insolvency procedure is a commercial decision for the insolvency practitioner to take. Accepting vouchers may limit what could be paid back to a company’s other creditors; but the insolvency practitioner could also decide that accepting vouchers would be beneficial for the company’ creditors – it really depends on the situation. Make sure you speak to the insolvency practitioner handling the insolvency for more information.

I am in a legal dispute with a company or individual that is now insolvent, and I believe I am owed damages. How is my claim affected?

You could still count as a creditor so you should speak to the insolvency practitioner dealing with the insolvent company to discuss your claim. The insolvency practitioner will decide to accept or reject your claim – if your claim is rejected, you can go to court for an adjudication.

Which government department is responsible for insolvency?

Different government agencies and departments oversee insolvency in England & Wales, Scotland, and Northern Ireland. You can see the list of agencies here.

My employer has gone bust and can’t pay me what I’m owed.  I’ve had a letter telling me that I no longer have a job.  What happens now?

If a company or business is insolvent, your employment has been terminated and your employer is unable to pay you what you are owed as an employee, there is protection in place to make sure that you do not lose out completely. You can make claims by applying to the National Insurance Fund via the Insolvency Service (IS).  Claims that you can make are:

  • unpaid wages or salary for up to eight weeks;
  • holiday pay for days not taken, but due under your contract of employment, up to a maximum of six weeks;
  • statutory notice pay;
  • redundancy;
  • a basic award for unfair dismissal.

Unpaid pension contributions can also be claimed for via the appointed insolvency practitioner.

For all these payments, from 6 April, 2018 there is an upper limit of £508 a week.  If you are owed more than the RPS can pay, you must make a claim as a creditor in the insolvency.  There may not be enough money to pay you from the insolvency so unfortunately you may lose out on some of what is due to you.

You can claim for statutory notice pay if:

  • you worked the statutory notice period but not been paid by your employer;
  • you were dismissed without notice;
  • you haven’t worked your full notice.

You must remember that the notice part of any claim you may have needs to be minimised by you so you must take steps to claim whatever benefits you may be entitled to (November 2017 Jobseekers Allowance or Universal Credit).  The IS will deduct amounts received from the amount due.

Through the Fund, the IS will pay you the redundancy payment you would normally be entitled to from your employer. However, if your contract of employment set out more than the statutory minimum, you will not be entitled to payment through the Fund for that additional amount.

Redundancy pay is due if:

  • You have been continuously employed for 2 or more years;
  • You have applied in writing to your employer or an employment tribunal within 6 months of the job ending.

The amount due will be based on age and length of service.  You can calculate the amount due to you here 

I have been made redundant. What is the process for making a claim?

You should have received notification of appointment from the person, known as the office holder who will be a licensed insolvency practitioner or the Official Receiver (OR), who is dealing with the insolvent business.  The office holder or the OR will give you a factsheet that tells you what to do when you’ve been made redundant.  Make sure that the factsheet given to you has a case reference number written on it as without this you will not be able to proceed with your claim.  It is anticipated that you will be able to go online to make your claim and you will need to allow yourself enough time to complete the application which the government thinks will take you between 25-45 minutes.

The first claim you make will be for redundancy pay, unpaid holiday pay and unpaid wages.   If you decide that you also want to make a claim for not receiving notice of your dismissal, you will tick a box on the online form.  This claim is made separately once your statutory notice period ends.  You don’t need to keep track of this date as the RPS will contact you again when it is time for you to apply.

The government provides information to employees about your rights if your employer is insolvent which you can access here