Published 12 December 2020

Author: John Waller

HM Gov Reinstate Support for UK Companies

On 9 December 2020, the HM Gov Reinstate Support for UK Companies reinstate the temporary suspension of statutory demands and winding-up petitions until 31 March 2021.

On 25 November 2020, the UK government declared its intentions to restore the temporary removal of the peril of personal liability for wrongful trading from company directors unto 30 April 2021.

The government stated that UK companies and other qualifying entities with responsibilities to hold AGMs will continue to have the adaptability to have meetings virtually until 31 March 2021. Therefore, company shareholders may remain to examine their company records and vote remotely using a Virtual meeting online.

Additional changes to ensure UK businesses safeguarded against insolvency introduced in the Corporate Insolvency and Governance Act (Structural changes to UK Corporate Law in 2020) had been due to expire on 30 September 2020

HM Gov Reinstate Support for UK Companies by temporary measures, in addition to the above include:

  • Termination clauses are still prohibited. Therefore, stopping suppliers from ceasing their supply. They may also not ask for additional payments while a company is going through a rescue process. However, small suppliers will remain exempted from the obligation to supply until 30 March 2021 so that they can to protect their business if necessary.
  • The modifications to the new moratorium procedure, which relax the entry requirements, extend until 30 March 2021. A company may enter into a moratorium. Conditional though on if they have been subject to an insolvency procedure in the previous 12 months. Measures will also ease access for companies subject to a winding-up petition. The temporary moratorium rules now extended to 30 March 2021

Further, UK Companies:

  • Remain guarded against eviction until the end of 2020.
  • Therefore, businesses remain guarded if unable to pay rent. Further, the Coronavirus COVID-19 pandemic’s impact allows tenants protection from eviction, assisting with bolstering job security for many.
  • Where businesses can afford to pay landlords their rent, then they should continue to do so. The HMGov support is for companies which are in financial distress with cash flow issues. For further reading, check out the Code of Practice published in June 2020 for additional clarity.

For further support from HMRC, view HMRC Offices Around the UK.

If you require further help on:

HM Gov Reinstate Support for UK Companies

or Business and Company Debt Help.

Please contact HBG Advisory on:

FREEPHONE 0800 612 5448.

For Business Insolvency Advice & Support.