The temporary measures to support businesses from insolvency as a result of COVID-19 are being phased out from 1 October. New targeted measures are to be introduced to help smaller companies.
The new legislation, replacing the Previous provisions, will from 1 October:
- Raise the current debt threshold for a winding-up petition to debts of £10,000 or more.
- Give debtors 21 days to respond with payment proposals before a winding-up action can be taken.
These new provisions will be in force until 31 March 2022.
The protection from eviction for commercial tenants will continue until 31 March 2022. The government then intends to introduce a rent arbitration scheme to deal with rental debts as a result of the pandemic.
Useful guides on this topic
Corporate Insolvency and Governance Act 2020
The Corporate Insolvency and Governance Bill 2020 aims to give companies experiencing financial difficulties as a result of the Coronavirus outbreak extra assistance to increase their chances of survival. A number of measures delay the normal insolvency timetable and prohibit claims by creditors.
Ceasing trading Index: What are your options?
Subscriber guide to closing down your company.
COVID-19: Government Support Tracker
This FREEVIEW tracker covers the key measures announced by the government to support individuals and businesses, as we get through COVID-19. This tracker is updated on a daily basis.
Insolvency FAQs for directors
This guide considers some common FAQs that directors may have about insolvency situations.
Press release: End of temporary insolvency measures