Company Administration

Immediate Legal Protection While You Find a Way Forward

When a business is under intense pressure from creditors, the first priority is often simply to stop the clock. Company Administration does exactly that.

The moment an administrator is appointed, a statutory moratorium comes into force – a legal shield that immediately prevents creditors from starting or continuing any action against the company without the court’s permission. No winding-up petition can be progressed. No enforcement action can be taken. The pressure stops, and the focus shifts to what happens next.

Administration is not an end point. It is a temporary protected space in which the future of the business can be properly assessed and the best available outcome for creditors can be pursued – whether that is a restructure, a sale of the going concern, or an orderly wind-down that achieves more than an immediate closure would.

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Trusted. Regulated. Experienced.

1. Regulated by the ICAEW 2. 30+ years of insolvency practice 3. Award-winning Firm

Is Your Business Facing Unmanageable Creditor Pressure?

Financial distress rarely arrives suddenly, but the point at which it becomes unmanageable often does. A winding-up petition served at your registered office. An HMRC enforcement notice. A creditor who has lost patience and is escalating to legal action.

If your company is insolvent but the underlying business has genuine value – strong customer relationships, active contracts, a capable team – administration may be the right tool to protect that value while a longer-term solution is found.

The key distinction between administration and other rescue tools is speed. A CVA requires creditor approval before its protections take effect, which can take weeks. Administration provides immediate statutory protection from the point of appointment. For directors in an urgent situation, that difference can be decisive.

Is Your Business Facing Unmanageable Creditor Pressure?

What is Company Administration?

Company Administration is a formal insolvency process in which a licensed insolvency practitioner – the administrator — takes over management of the company. The administrator’s legal duty is to act in the interests of the company’s creditors as a whole, pursuing the best available outcome from a defined hierarchy of objectives.

The first objective is rescue of the company as a going concern. Where that is not achievable, the administrator seeks to achieve a better result for creditors than would be possible through an immediate winding up. Where neither of those is possible, assets are realised to make a distribution to secured or preferential creditors.

Within eight weeks of appointment, the administrator must file formal proposals with creditors setting out the plan and the rationale. Creditors then vote on whether to approve those proposals.

Administration is temporary by design. It automatically ends after twelve months, though it can be extended with creditor or court consent where the process requires more time.

What Happens to Directors During Administration?

This is one of the most common questions directors ask — and it is worth answering clearly.

Once an administrator is appointed, they take over legal control of the company. Directors do not cease to exist as directors, but their powers are effectively suspended for the duration of the administration. They cannot make decisions about the company’s assets or operations without the administrator’s consent.

In practice, however, most administrators work closely with the existing management team throughout the process. Directors know the business — its customers, its contracts, its people — in ways that an external practitioner cannot replicate quickly. Where the business continues to trade during administration, that operational knowledge is valuable and is used.

Directors who have acted responsibly and in good faith prior to administration are not at heightened personal risk simply because the company enters that process. The administrator’s investigation focuses on conduct, and directors who sought advice and acted appropriately have little to fear.

Considering administration — or trying to understand whether it is the right route? Our first conversation will give you a clear, honest picture based on your specific situation.

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What Happens to Directors During Administration?

Expert Advice, Delivered Personally

The Insolvency Practitioners is an independent national firm led by Michael Chamberlain – one of the UK’s most respected insolvency professionals. With over 30 years of experience and Big 4 pedigree, Mike built this firm on the belief that directors deserve honest, expert advice delivered with humanity, not judgement.

Every director who contacts us speaks to Mike directly – not a junior, not a call handler. That is not something every firm can say.

“In thirty years, I’ve seen that the most successful administrations are those where we act quickly to stabilise the situation. Administration isn’t the end of a business — often, it’s the only way to protect the value you’ve built and find a sustainable path forward.”

How the Administration Process Works

  1. Appointment. An administrator is appointed by the directors, the company, or a qualifying floating charge holder — typically a bank with a charge over the company’s assets. In urgent cases, appointment can happen very quickly.
  2. The moratorium. Immediate legal protection is triggered from the point of appointment. All creditor action — including winding-up petitions — is halted.
  3. Proposals. Within eight weeks, the administrator files formal proposals with creditors outlining the plan and the rationale. Creditors vote on whether to approve the proposals.
  4. Implementation. The administrator manages the company’s affairs to achieve the best available outcome — whether that is restructuring, a sale, or an orderly wind-down.
  5. Exit. Administration ends when the objective is achieved. Possible outcomes include a return to director control, a transition into a CVA, a completed going-concern sale, or — where rescue is not possible — movement into liquidation.
How the Administration Process Works

Ready to Understand Your Options?

Whether administration is the right tool or another route makes more sense, our first conversation will establish that clearly — and quickly, if the situation requires it.

Not sure whether administration or a CVA is the right rescue route? Our Rescue My Company page explains both options and helps you identify which applies to your situation.

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FAQ's

Does administration stop a winding-up petition?

Yes — immediately. The statutory moratorium prevents any creditor from starting or continuing legal action against the company without the court's permission. This includes winding-up petitions that have already been served. For directors facing imminent court action, this is often the most urgent reason to consider administration.

How quickly can a company enter administration?

In urgent cases, administration can be initiated within 24 to 72 hours. Directors can appoint an administrator out of court without requiring a judge's involvement, which makes it significantly faster than many other formal procedures. Where a winding-up hearing is imminent, speed is often the deciding factor.

Can I still run the business during administration?

Once an administrator is appointed, they take over legal control of the company. In practice, most administrators work closely with the existing management team throughout - particularly where the business continues to trade. Directors retain their knowledge of the business and are typically involved in day-to-day operations under the administrator's supervision.

How long does administration last?

Administration automatically ends after twelve months. It can be extended with creditor or court consent where the process requires more time. In many cases, the administration concludes earlier than twelve months once the primary objective has been achieved.

What are the possible outcomes of administration?

Administration can end in several ways: the business is rescued as a going concern and control returns to the directors, a going-concern sale is completed to a third party or connected management team, the business transitions into a CVA for ongoing restructuring, or — where rescue is not achievable — the company moves into liquidation. The administrator's proposals set out which outcome is being pursued and why.

Who pays the administrator's fees?

Administrator's fees are paid from the company's assets and realisations made during the process — not directly by the directors. We will provide a clear explanation of the fee structure during our initial consultation before any work begins.

What is the difference between administration and liquidation?

Liquidation means closing the business and selling its assets to repay creditors — it is the end of the company. Administration is a rescue and protection mechanism that seeks to save the business or achieve a better result than an immediate closure would produce. Administration can lead to liquidation if rescue is not possible, but it begins from a fundamentally different premise.

Will my employees be affected?

If the business continues to trade during administration, most employees are typically retained. Where redundancies are necessary, the administrator guides staff through the process of claiming redundancy pay, unpaid wages, and other entitlements from the government's Redundancy Payments Service. In going-concern sales, employees frequently transfer to the buyer under TUPE regulations.

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