Keeping busy in a, relatively, quiet market…
17 February 2016: As we recently reported, according to official figures from The Insolvency Service, an estimated total of 14,629 companies entered into a formal insolvency process in 2015, which was 10% lower than the total in 2014 and the lowest annual total since 1989. The number of companies that faced a compulsory winding-up order in 2015 was at its lowest level for 34 years. For personal insolvencies, the number of people who were declared insolvent was at is lowest level for a decade in 2015, although there was a noticeable increase in the last quarter. However, this was the fifth successive decrease in the annual total.
Whilst it is certainly true that the insolvency profession as a whole is not as busy as might be expected during a time of ongoing global and national economic uncertainty (which can reasonably be described as a tentative economic recovery at best) we at BRI continue to experience a high demand for responsive and proactive advice from companies and individuals dealing with financial difficulty.
At BRI, we firmly believe that the right approach is to provide the right advice first time and every time, regardless of whether that leads to a fee outcome or formal appointment for us. Indeed, probably seven out of ten initial advice matters which we assist on do not become fee paying instructions for us. However, we are passionate about assisting the local and business community and the clients of our many professional contacts who are experiencing difficult financial circumstances, who really do benefit from taking some expert advice at an early stage. The full range of options that we are able to provide advice on can be viewed by clicking on the ‘Services’ tab at the top of this webpage.
One area we continue to see a significant increase in enquiries (and indeed appointments) in at present is members’ voluntary liquidations (i.e. solvent liquidations). We attribute this spike to the anticipated changes to the Finance Bill 2006, which is expected to take effect from 6 April 2016 and which will make it more difficult for shareholders of a solvent company to avail of the more beneficial tax treatment which is currently available. Under the present rules, a shareholder can take receipt of a distribution of capital from a liquidator which is taxed at a rate of potentially 10% (where Entrepreneur’s Relief is applicable) instead of a higher rate of potentially 28% or more for a distribution of income. Please see our recent article on this topic for further details or alternatively contact a member of the BRI management team to discuss.
Our message to any individual or company experiencing any financial difficulties is to take professional and specialist advice as early as possible. So, if you or your clients require any assistance for dealing with any queries, issues or financial difficulties then please contact a member of the experienced BRI management team at one of our offices for free, confidential, no obligation and independent advice.