A Very Credit Christmas…

Last year, a survey showed that nearly one in seven people were worrying about money in the run up to Christmas.  Of those people who took part in the survey, 37% were planning to fund the cost of Christmas with the use of credit.  This figure signified an increase in the number of people turning to credit for Christmas costs, on 2016*.

The findings showed that:

  • Nearly four in 10 Britons (37 percent) were putting Christmas presents on credit.  This was an increase on the previous year.
  • Nearly a quarter of British adults (24 percent) put their Christmas food on credit.  This was also an increase on the previous year.

The research, based on a poll of more than 2,000 British adults conducted online by YouGov, also found that more people were experiencing worry, stress and sleepless nights this Christmas than in previous years.

If you are worried about your finances in the run up to Christmas, the first step is to discuss your situation to understand the steps that you need to take in order to get back on track and feel better.

Dunion & Co. offer a free initial consultation: no jargon, no pressure and absolutely no obligation.

Call 01782 828 733 or email to enquiries@dunionandco.com, for more information.


* figures taken from the Money Advice Trust.


Directors’ Conduct in Insolvency: Our Top Tips…

I meet a lot of Directors who are surprised to learn that their conduct will be investigated on the back of their Directorship of a company, that has entered into Insolvency.

Insolvency Practitioners are legally required to submit a completed questionnaire to the Department for Business, Energy and Industrial Strategy. This forms a commentary on Directors’ Conduct, which the Department uses to decide whether further investigation is appropriate.

Considering that a negative report could lead to Directors’ Disqualification of up to 15 years, I’ve put together these tips for you in the spirit of maintaining good conduct.

Keep meticulous records

Finances and company decisions should be recorded carefully and in detail from the first day of trading to the last. During Insolvency, investigative bodies want to understand your route to business failure and clear records will assist you in your explanations.

On a side note, detailed, accurate records often prevent investigations in the first place.

Co-operate with Insolvency Practitioners

I can’t stress this enough. If you’ve entered into Insolvency, work with the appointed Insolvency Practitioner. That means making information available as needed, in a timely and ordered fashion. (Use your accountants and any legal advisers to help in supplying accurate information, if necessary.)

Co-operate with Creditors

You may be required to attend a meeting with your company’s creditors, depending on the type of insolvency process. If you are not entitled to be at a meeting, or you are asked to leave on sound grounds, do so.

Take care with your responses to Creditors of course – you may wish to seek legal advice beforehand. You’ll be questioned (potentially quite rigorously) and it goes without saying that being open and neutral in your response is preferential.

Take care with the questionnaire

During Insolvency, you’ll be asked to complete a questionnaire – the questions aim to establish the reasons for business failure and may also be used to assess any wrongdoing. I’d always advise working with your accountant and/or lawyer for accuracy, which protects you and is most helpful during insolvency proceedings.

You’ll need to complete the questionnaire if you’re a registered Director with Companies House, use ‘Director’ in your business title, or act as a Director in your work for the company.

Pay attention to the submission deadline, too. Legally, you must assist Insolvency Practitioners – meeting deadlines is a logical part of this.

Continuous conduct

Of course, your attention to Directors’ Conduct should start from the moment you act as a Director, not only when questioned. It’s also worth noting that both the public and creditors can report any concerns about your conduct at any stage, Insolvent or not.

If you’d like advice on Directors’ Conduct, or Insolvency proceedings, please do not hesitate to contact the team at Dunion & Co., for a free initial consultation. 

01782 828 733 | www.dunionandco.com | enquiries@dunionandco.com

What to do if your franchisor becomes insolvent…

When you enter into a franchise agreement, you are essentially setting up your own business (albeit under an established name).

However, the arrangement means that if the franchisor gets into financial difficulty, the franchisees are likely to be impacted too.

This is what happened recently, when Bargain Booze’s parent company, Conviviality, entered into administration, after being faced with a decline in sales and a hefty tax bill.

What happens when a franchisor enters into a formal insolvency?

If a Franchisor enters into liquidation, a licensed insolvency practitioner will be appointed to deal with the administration of the company’s liquidation.  The role of the insolvency practitioner, acting as liquidator in this instance, will be to sell the company’s assets for the benefit of the company’s creditors.

In these circumstances, it is often the case that the primary asset is intellectual property in the form of the brand name itself (and the goodwill associated with it).  As such, the liquidator is likely to facilitate a sale of the brand name.

Once the company enters into liquidation, franchisee agreements cease; the franchisee can continue trading but is prohibited from using the brand name.  This presents franchisees with two options:


Both options would allow former franchisees the opportunity to trade on, without the restrictions of a franchisee agreement.

If a franchisee has been heavily reliant on the franchisor for guidance / assistance with running the business, they may not have the experience necessary to operate alone.  In addition, it may be necessary to renegotiate the terms of agreements in place with suppliers / wholesalers; the existing relationships are likely to have developed because of the large orders being placed by the franchisor.  Indeed, the franchisee may not even HAVE a relationship with the necessary suppliers / wholesalers.

If individual franchisees are not in a position to make an offer to purchase the intellectual property, one option is for a number of franchisees to ‘club’ together in order to make an offer on the basis of a shared interest.

Should you wish to discuss your situation with us, please get in touch for a free consultation.

Contact us now: 01782 828 733 | enquiries@dunionandco.com

Calling all Accountants!

  • Is your client a director of a limited company?

  • Has the Company been trading for over two years?

  • Is the Company facing financial difficulties?

  • Is the director faced with the possibility of the Company ceasing to trade?

If so, it is likely that your client can make a claim for director redundancy, for which the average claim is currently £10,000.  In addition, they are likely to be able to claim for other statutory entitlements, such as notice pay, holiday pay, and unpaid wages.

Even if the company is already in liquidation, it is likely that a claim can still be made for post-insolvency redundancy payments (in addition to other statutory entitlements).

Call us for a chat, if you would like to know more.

01782 828 733 | enquiries@dunionandco.com | www.dunionandco.com

New tools to improve rescue opportunities for financially-distressed companies

The Government has announced new tools that will improve rescue opportunities for financially-distressed companies.

The measures have been announced alongside new reforms that will help the Government tackle reckless directors and improve corporate governance to protect creditors, employees and other stakeholders in companies approaching insolvency.

The new rescue measures aim to strengthen the insolvency regime follow a consultation in 2016 where the majority of respondents were in favour of the Government’s proposals. These plans have similarities to aspects of the US’s Chapter 11 Bankruptcy Code and other international regimes and balance support for a company in distress with the interests of its creditors.

‘Breathing Space’

These include a period of ‘breathing space’ – a moratorium – allowing viable companies more time to restructure or seek new investment to rescue their business free from creditor action. There is also a new restructuring plan procedure that will provide an alternative option for financially-distressed companies to restructure their debts.

Companies will be supported through a rescue process by the introduction of new rules to prevent suppliers terminating contracts solely by virtue of a company entering an insolvency process.

‘More Protection for Employees’

Following concerns about some recent high-profile corporate failures, new measures are also being introduced to help ensure that creditors, employees and other stakeholders are treated fairly by the directors of ailing companies.

These proposals include new powers for the Insolvency Service to investigate directors of dissolved companies, enhancements to existing antecedent recovery powers and the ability to disqualify directors of holding companies who unreasonably sell insolvent subsidiaries.

Further insolvency-related tools announced aim to help unsecured creditors through applying an inflationary increase to the cap on the ring-fenced pot of money available to unsecured creditors, called the prescribed part that has remained unchanged since its introduction in 2003.

‘Reckless Directors’

On the same day, the Government introduced measures to improve corporate governance that aim to tackle reckless directors and better protect pensions, small suppliers and workers who lose out when companies go bust.

Taken from a joint Press release published by The Insolvency Service and Kelly Tolhurst MP


What happens if I can’t pay my Corporation Tax?

When a business has a temporary cash flow problem, HMRC’s Business Payment Support Service will consider reaching a time to pay agreement (‘TTP’).

Can I pay my Corporation Tax in Instalments?

  • HMRC can grant additional time to pay for all forms of taxation arrears, by way of instalments.

What is a Time to Pay Agreement (TTP)?

  • A TTP is a method of supporting viable businesses that are suffering short term cash flow difficulties and are designed to help businesses get back on their feet.
  • The Business Payment Support Service will generally not consider anything longer than 12 months.
  • For those businesses with tax liabilities in excess of £1 million the taxman will also require that an independent review is undertaken by a qualified professional adviser, such as an insolvency practitioner.


  • Payments can be made over a longer period of time, assisting with cash flow
  • Affords the Company ‘breathing space’
  • Formal insolvency procedures are averted
  • Legal action is prevented
  • Surcharges and penalties are avoided (if the arrangement is put in place before tax payment due)
  • Corporation tax, VAT and PAYE can all be included


  • Repayments must be made in full and on time
  • Interest is payable on all monies outstanding
  • If the arrangement is cancelled, enforcement action may ensue

Is a TTP right for me?

Whether you are a sole trader, a partnership or a limited company, TTP are useful for businesses where tax arrears have accrued as a consequence of cash flow shortage.  However, there MUST be a reasonable prospect that the business will return to financial stability.

Our top tips!

  • Dealing with HMRC can be problematic; seek assistance from a qualified Insolvency Practitioner, in order to give yourself the best chance at putting your case forward for consideration.
  • Always be proactive; be responsible and seek advice from a professional, at the earliest opportunity.

The Team at Dunion & Co have a good working relationship with the Business Payment Support Service. Should you require assistance with a TTP, please do not hesitate to get in touch with us for a confidential, no obligation, free initial consultation.

House of Fraser: What’s the deal?

On 10 August, House of Fraser Limited entered into Administration.  Shortly after, Alan Hudson, one of the Joint Administrators, announced that they had “successfully concluded a sale of the business in a short timescales, which preserves as many of the jobs of House of Fraser’s employees, as possible”.

The business was bought by Sports Direct, owned by Mike Ashley, for £90million.

Effectively, the Administrators effected a ‘pre-pack’ administration.

What is a pre-pack Administration?

A pre-packaged (or ‘pre-pack’) sale is an arrangement under which the sale of all or part of a company’s business or assets is negotiated with a purchaser prior to the appointment of an Administrator, following which the Administrator effects the sale immediately on, or shortly after, appointment. Once the process of Pre-pack has been started the limited company is protected from action by creditors.

When is a pre-pack Administration appropriate?

A pre-pack administration should only be undertaken where it presents the Company’s creditors a better outcome than other formal insolvency procedures, such as Creditors’ Voluntary Liquidation, Administration or a Company Voluntary Arrangement.  For example, where a Company is insolvent, but has a sustainable and profitable business (subject to the burden of its debts), or where divisions of a Company are no longer profitable but the Company is unable to formally restructure due to a lack of resources.  A pre-pack Administration is a formal insolvency procedure and advice should be sought from a Licensed Insolvency Practitioner.

The Administrator’s Role

In a pre-pack administration, the primary function of the Administrator is to rescue the Company.  The Administrator is required to act quickly, in order to maximise goodwill.  In addition, the Administrator must make a decision with regards to the Company’s employees, i.e. whether employees are retained.  The Administrator also has reporting obligations, in respect of the Company’s creditors.

How quickly can a pre-pack administration be effected?

The preparation for a pre-pack administration will usually take between two to three weeks.  During this period, a sale agreement may be drafted in order to formalise the sale of the Company.  Once the Company has entered into Administration, the sale of the former Company will take place immediately.


Pre-pack Administrations can attract criticism from those outside the Company.  A sale of the business will generally be agreed in advance of the Administration, ‘behind closed doors’.  This can result in interested parties feeling as though they have missed out on the opportunity to acquire the Company, as well as creditors feeling as though they’ve been ‘cheated’.

To discuss Pre-Pack Administrations further, please contact Dunion & Co by calling 01782 828 733 or e-mailing us on enquiries@dunionandco.com.

The ‘Katie Price’ Strategy: Proposing an IVA in Order to Avoid Bankruptcy

Katie Price’s financial woes have been widely reported of late.

Earlier this week, a Creditor’s Petition* for her bankruptcy was heard in the High Court.

However, Ms Price managed to stave off the making of a Bankruptcy Order.


Her representatives requested an adjournment, on the basis that Ms Price intends to propose an Individual Voluntary Arrangement (“IVA”).

The adjournment was granted, allowing Ms Price a period of three months in which to make the proposal to her creditors.

What is an IVA?

An IVA is essentially a formal deal between an individual and their creditors to pay back part or all of their debts over a period of time, in order to avoid bankruptcy.

Monthly payments are based on affordability. You will provide details of your income and outgoings and your surplus/disposable income (i.e. the amount you have left over every month) will be the amount you pay each month into your IVA.

Most IVAs last for five years (60 months). However, in certain circumstances, it is possible to make a ‘one off’ offer of a payment to your creditors from, for example, the sale of a property or other assets, redundancy monies or the introduction of funds from a third party, e.g. relative or friend.

Upon the approval of an IVA, you will cease to make payments directly to creditors, and creditors are required to freeze interest and charges.  Once the IVA is completed, any outstanding balances on debts will be written off.

Why did she do this? What are the advantages of an IVA over Bankruptcy?


BKY – Once a bankruptcy order has been made, the matter will be handed over to the Insolvency Service, who may appoint a Trustee in Bankruptcy. As a consequence, there is very little flexibility and an individual facing bankruptcy will have little control over the process.

IVA – An IVA is more flexible than bankruptcy.  An IVA Proposal is drafted to fit your individual circumstance and, if your circumstances change during the course of the Arrangement, the terms can be varied. 


BKY – You are unlikely to be able to maintain control of all of your assets of value in a bankruptcy. It is probable that they will be realised, for the benefit of your creditors.

IVA – In an IVA, you effectively retain control over your assets and will be able to keep all reasonable assets of value.

Company Director?

BKY – In bankruptcy, until you are discharged, you are prohibited from promoting, forming or managing a limited company, unless you have explicit permission from the court. This restriction can be debilitating if you hold a directorship and run your own company.

IVA – You can continue or become a company director in an IVA.


BKY – In certain trades and professions, your employment may be affected, by bankruptcy; some professional / trade bodies will not allow you to practice once a Bankruptcy Order has been made against you

IVA – With an IVA, employment is unlikely to be affected. 


*What is a Creditor’s Petition?

Creditor’s petition – this is where a creditor (someone to whom you owe money) petitions the Court for you to be made bankrupt. A creditor cannot petition for your bankruptcy unless they are owed at least £5,000.


For more information, please do not hesitate to contact us on 01782 828 733 or enquiries@dunionandco.com.



What are the advantages of an IVA over a Debt Management Plan?

What are the advantages of an IVA over a Debt Management Plan?

Interest and Charges…

IVA – Creditors must freeze all interest and charges

DMP – There is no such obligation in a debt management plan

Will it prevent my Creditors from taking legal action against me?

IVA – Once an IVA is approved, any pending/outstanding legal actions are suspended and, as long as the IVA is complied with, no further action can be taken.

DMP – Creditors are not restricted from taking further action, at any point during negotiations / once a DMP is underway. 

Is it Legally Binding?

IVA – An IVA is a legally binding arrangement 

DMP – A debt management plan is an informal agreement. 

Who can set it up?

IVA – The services of a Licensed Insolvency Practitioner are required to propose an IVA on your behalf, the benefit being that Insolvency Practitioners are highly regulated and have years of experience and knowledge. 

DMP – There are no formal qualifications / no level of experience required to set up a DMP. 

Are my debts written off?

IVA – At the end of your IVA all remaining unsecured debt is written off.  

DMP – A debt management plan will continue until you have repaid all your debt, including interest and charges. 

Do my Creditors have to agree?

IVA – Once an IVA is approved all unsecured creditors, whether they voted for acceptance or not, are bound by the terms of the arrangement. 

DMP – Creditors do not have to accept a debt management plan and, if they do, they are not obliged to continue under the terms of the plan.  

How long will it last?

IVA – An IVA usually lasts for five years, depending on circumstances and progress of the IVA.  

DMP – There is no guaranteed end date for debt management plans due to potential interest and charges being levied by creditors.

Should you wish to discuss the contents of this blog, please do not hesitate to contact us on 01782 828 733 or enquiries@dunionandco.com.