FAQs

Pre-pack is a term used when a sale of the assets of a struggling company is packaged to be sold immediately after an appointment of an Administrator or Liquidator is made. The sale may be to a connected party or not. It will most likely be a sale after a short period of marketing the business and should achieve a greater value for the assets than if the assets had been sold separately (such as through an auction). It is also very likely that employees’ contracts will be transferred to the purchaser by TUPE transfer.

There is no limit to the length of time a Liquidation can last, but it will depend on the work it involves. The Liquidator will need to realise all of the assets and some of these (such as retentions) take longer than others (such as cash at bank). If the Liquidator has any matters that require Court involvement, this can take a considerable time, as it is dependent upon the Courts scheduling.

An Administration will last for less than a year (unless it is extended by consent of the creditors or by a Court Order). It is common for an Administration to become a Liquidation within the first year.

The Liquidator has the task of realising all assets of the company. Agents are usually appointed to market and sell assets, such as machinery, vehicles, stock and other chattels. The majority of these will go to an auction and there are general auction sites used by agents such as https://www.bidspotter.co.uk/en-gb and https://www.i-bidder.com/en-gb (other sites do exist).

The Liquidator will also collect any monies due to the company (book debts, retentions, work in progress and any loans) and will acquire any cash the company has in the bank.

Sometimes the Liquidator will be able to sell intangible assets, such as goodwill, trademarks and patents.

Properties (freehold and leasehold) will be marketed and sold by property agents and this is usually done via the property agents website and sites such as Rightmove and Prime Location.

The Insolvency Act 1986, sets out what is considered to be associated with a company.

A link to this section can be found here.

Insolvency Practitioners have a legal requirement to purchase an Insolvency Bond for every case they are appointed to act on. The bond is an insurance policy which will pay out if any monies have been misappropriated by the Insolvency Practitioner.

The amount of the bond charged will depend on the size of the assets that are expected to come into the control of the Insolvency Practitioner and will be dependent on the type of appointment.

The bond charges of Revive Business Recovery Limited can be found here

If a bailiff is knocking on your door, it is due to a debt not being paid, which has followed a Court procedure to register the debt and allowing the bailiff to recover this. You should get notice in advance that a bailiff is likely to call.

If they do turn up, make sure that you see their badge or ID card. (Take a picture with your phone of this so you have a record of who it is you were dealing with. All bailiffs must have a certificate.

To stop them, you will need to make an arrangement with them to pay the debt (and stick to it). Make sure you get a receipt for any payments made to the bailiff.

If you are unable, or unwilling, to settle the debt with the bailiff they may take some of your belongings to sell. They can take luxury items (TV’s game consoles, cars), but cannot take items that you need, such as your clothes, cooker, work tools and equipment. They cannot take anything that belongs to somebody else, but you will need to prove this.

Bailiffs cannot enter your home by force. They cannot enter your home through anything but a door and they must operate between the times of 6 am and 9 pm. They cannot enter if the only occupants at the time are children under the age of 16 or are people classed as vulnerable.

It is very difficult to estimate the cost of a liquidation from preliminary conversations. In order to give you an understanding of why this is, I detail as follows how the fees work.

When an Insolvency Practitioner is instructed to act for the company, it will most likely be in the period before it is liquidated. The Insolvency Practitioner will usually estimate an amount and quote a fixed fee for the work that is to be undertaken up to the date the company enters liquidation. The directors will usually agree to this fee and quite often this is paid prior to the liquidation by the company. On some occasions, this fee is to be paid from the assets of the company (when they are sold or realised later). If this is the case, the creditors will be asked to approve these fees. They are usually referred to as pre-appointment Liquidation fee, an advice fee or Statement of Affairs fees.

The Insolvency Practitioner will estimate and set the fee, based on the size and complexity of the company.

Once appointed, the Liquidator will ask the creditors to approve the fees for acting as Liquidator (i.e from the period that the company went into liquidation onwards). It is usually based on the time the Liquidator and associated staff will spend on the case but can be based on a percentage of realisations (or a mix of both).

To do this, the Liquidator will either send out estimates of the fees they expect to incur and ask for approval, or they will wait until they have carried out the majority of their functions, report on what they have done and the detail the fees they believe they should draw for this.

If there is a creditors committee, it will be the committee who will set the fee, but if there is no committee, the creditors will vote on this.

If the Liquidator is not happy with the amounts that the creditors agree to, a Court application can be made for this to be determined by the Court.

If any creditor is not happy with the amounts that the Liquidator draws, they too can go to Court.

Further details can be found in the documents below:

Creditors Guide to Fees - Liquidators

It is very difficult to estimate the cost of an Administration from preliminary conversations as it will depend on whether the Administrator trades the company to sell or just wraps the company up.
In order to give you an understanding of why this is, I detail how the fees work.

When an Insolvency Practitioner is instructed to act for the company, it will most likely be in the period before it goes into Administration. The Insolvency Practitioner may estimate an amount and quote a fixed fee for the work that is undertaken to be done up to the date the company enters Administration.

The directors will usually agree on this fee and pay this prior to the Administration appointment. On many occasions, this fee is to be paid from the assets of the company (when they are sold or realised later) and if this is the case, the creditors will be asked to approve these fees. They are usually referred to as pre-appointment Administrators’ fees or pre-appointment advice fees.
The fee will be estimated and set, based on the size and complexity of the company.

Once appointed, the Administrator will submit the Proposals to creditors (this is a report by the Administrator which sets out what the Administrator intends to do and what the Administrator hopes to achieve (as well as give creditors some insight as to why the company ended up in Administration in the first place). This document should detail the pre-Administration fees and costs and the Administrators post appointments for creditors (or the committee if appointed) to vote on.

It is usually based on the time the Administrator and associated staff will spend on the case but can be based on a percentage of realisations (or a mix of both).

If the Administrator is not happy with the amounts that the creditors agree to, a Court application can be made for this to be determined by the Court.

If any creditor is not happy with the amounts that the Administrator draws, they too can go to Court.

Further details can be found in the document here.

Most often the answer is the company will pay.

In a Creditors Voluntary Liquidation, the fees usually come from the company itself, when assets are realised. If there are insufficient assets, the directors often contribute to the fee.

If a creditor has to take court action to wind the company up, they will incur costs in doing this, but these costs will be redeemed to them if the company has sufficient realisations to pay them back. If the company does not have sufficient assets, then the creditor will not get their costs back.

In reality, any fees charged to deal with the insolvency will shrink the amount available to creditors – which is why it is important that an Insolvency Practitioner is fair and transparent about their fees.

As a creditor, you will be told what the Liquidators fees are at various points of the Liquidation.

An unsecured creditor may, with the permission of the court or with the concurrence of 5% in value of the unsecured creditors (including the creditor in question), request further details of the Liquidator’s remuneration and expenses within 21 days of receipt of the report. Any secured creditor may request the same details in the same time limit.

An unsecured creditor may, with the permission of the Court or with the concurrence of 10% in value of the creditors (including the creditor in question), apply to Court to challenge the amount and/or basis of the Liquidator’s fees and the amount of any proposed expenses or expenses already incurred, within 8 weeks of receipt of the report. Any secured creditor may make a similar application to court within the same time limit.

In the reports that a creditor receives from an Insolvency Practitioner, expenses are split into two categories.

Category 1 – are expenses that are incurred and can be attributed directly from to the case. An invoice or other evidence of the expense is obtained and the amount will be paid from the case funds. An example would be advertising the appointment, which will be done by an advertising agent, who in turn will invoice the case and be paid accordingly.

Category 2 – are expenses that are incurred by the firm administering the case. They may be collective expenses that may be shared with other cases (i.e. storage of books and records where lots of company’s records are stored in the same place). In order to charge such expenses, a fair amount is usually re-charged and can be drawn (only if creditors have agreed).

If you apply to make yourself bankrupt (online), the costs are £680.

You will find with lots of really useful information on bankruptcy here.

All of your assets are included in your bankruptcy estate, with the exception of household items and items needed for your job (including a vehicle).

If any of the items that you are allowed to keep are classed as high-value luxury items, then you will not be able to keep these but will be given a reasonable alternative. An example of this would be if you had a high-value luxury vehicle that you needed to go to work and back. You would be provided with a reasonable “run of the mill” car and your luxury car would be sold. The same principle applies to antiques. If you have an expensive antique dining room table, this would be sold and you would be provided with an alternative.

What assets are not included in my bankruptcy?

Any items that are required for your job, such as tools or a vehicle are exempt and household items, such as clothing, bedding or furniture

The equity that you have in your house will be an asset of the bankruptcy estate. The Trustee or Official Receiver (the person who is appointed to deal with your bankruptcy) is required to realise this within 3 years of the bankruptcy order date.

The Trustee or Official Receiver will obtain a valuation and will write to the mortgage company (and anybody who has a charge on the property) in order to determine whether there is any equity in the house.

If there is negative (or no equity) they will leave the house (and reassess this before the 3 years expires). If after three years, there is no or negative equity, they will take no action and the property will revert back to you.

If there is a joint owner, they will be asked if they want to purchase the bankrupt’s equity. They could look at re-mortgaging for this if they do not have the funds readily available.

If there is equity in the house and the joint owner is unable or unwilling to purchase the bankruptcy estates share of the equity, then it will be required that the property is sold. There are concessions for residents (such as a wife and children) which will allow one year from the making of the bankruptcy order for them to find alternative arrangements before the house is put on the market.

This applies to the residential home. If there are other properties, such as a holiday home or investment properties, the 3-year rule does not apply and the Trustee or Official Receiver does not have any time limit to deal with the properties.

In any event, if there is a mortgage on the property, this will still need to be paid to avoid the mortgage company taking possession proceedings to re-possess the property.

No. This would result in you putting your assets out of the reach of your creditors and action would be taken for the recovery of this (with costs against you), which would most likely result in a bankruptcy restriction order against you.

No, you should immediately resign from any positions you hold as a director. You can apply to Court for permission to continue as a director.

The restrictions that you have to follow if you are made bankrupt are:

• You cannot borrow more than £500 without telling the lender that you are bankrupt
• You cannot act as a director of a company without the court’s permission
• You cannot create, manage or promote a company without the court’s permission
• You cannot manage a business with a name different from your own, without telling the people you do business with that you’re bankrupt
• You cannot work as an Insolvency Practitioner (an authorised debt specialist)

If you do break any of the restrictions, it is a criminal offence and you may be prosecuted.

You must also co-operate with the people managing your bankruptcy by providing them with full details of your assets and liabilities and any other information they ask for.

You are able to remain self-employed as a sole trader, as long as you trade under your own name, or the name you used when declaring the bankruptcy.

You will need to provide the Trustee or Official Receiver with your books and records relating to your business when you are declared bankrupt and you will need to ensure you keep proper records of your sole trader business going forward.

The income that you earn as a sole trader will need to be declared to the Trustee or Official Receiver (and expenditure), in order for them to assess whether you have any excess income to pay to the bankruptcy estate.

You will also have to abide by the bankruptcy restrictions.

It is recommended that you talk to the Official Receiver or Trustee to discuss this with them and ensure that you are not doing anything wrong.

Anybody that is owed money will be notified of the bankruptcy.

In addition to this, HM Customs and Excise, your bank, mortgage company, accountant and solicitor will be informed.

Your name will appear on the Individual Insolvency Register which can be searched by the public.

When you are first made bankrupt, the Official Receiver (or your Trustee) will write to the bank and the bank will freeze your account.

You can contact the Official Receiver to ask for permission to continue using the account. The bank will also need to allow you to use the account (and if it does allow this, it will most likely be on a credit basis only (with no cheque books).

If, at the time of your bankruptcy, the account is in credit (i.e. has funds in this), these will be an asset of the bankruptcy and sent to the Official Receiver/Trustee, unless it is a reasonable amount and is required for living expenses.

If it is a joint account – the Official Receiver will determine what proportion of the funds should go to the bankruptcy estate.

If the bank is overdrawn, the account will most likely be closed and the amount owed to the bank will be a creditor claim in the bankruptcy.

There are bank accounts out there for bankrupts, but they will need to operate in credit (i.e. with a positive fund balance). It may be a case of applying for a new account.

One of the forms that you will be required to complete when you are made bankrupt is an income and expenditure form.

On this form, you will include all of your sources of income, such as wages, benefits, child allowance/benefit, pension receipts, to name a few. You will do this in respect of your whole household.

You will also need to include all of your expenditure, such as mortgage or rent payments, all bills, food, petrol, etc. etc. The form you will be given has lots of categories on them to prompt you. It is probably worth having a good look at your bank statements to make sure you don’t forget anything.

If your income is more than your expenses, i.e if income is £3,000 and your expenses are £2,500, then you would be expected to make a contribution by paying the excess income to the bankruptcy estate (for the period of 3 years).

Please note that if the Official Receiver considers that any expenditure items are excessive, they can ask for you to reduce this. An example would be a family of 4 having a food allowance of £1,000 when the Citizen Advice Bureau calculates that this should be £523 for the month.

If you find yourself in the unfortunate position that you are made redundant, the company you work for is obliged to pay you all the monies owed to you under your contract of employment.

If you do not have a contract, you are still entitled to notice pay and redundancy (as well as any wages or holidays owed), based on the statutory amounts set by the government.

If the company does not pay you this, you can go to an employment tribunal to lodge an employment claim.

A useful link is found here.

If the company goes into an insolvency procedure, such as Liquidation, Administration or a Company Voluntary Arrangement (CVA) you will be able to claim for these from the Redundancy Payments Office.

You should be sent details from the Insolvency Practitioners office dealing with the claim, but more information and the link to make your claim can be found here.

If the company just closes, but does not pay you (or go into an insolvency procedure), you are still owed the money as per your contract. You can only claim from the company (the Redundancy Payments Office will only pay out if the company goes into an insolvency procedure).

If the company does not pay, you can take legal action against them to get them to pay or go to an employment tribunal. It is the most difficult situation to be in as, if the company has ceased trading because it is insolvent, it is unlikely that any actions will result in the company’s ability to pay you – even if you are awarded this.

You can take action to wind the company up (through the courts), which will most likely result in the company being placed into liquidation, but you would have to pay the fees involved in doing this. It is worth talking to an Insolvency Practitioner about this as, if you have a large claim, it may be worthwhile taking this action to enable you to then be able to claim from the Redundancy Payments Office. If there are a few employees, it may be worth grouping together to share the costs to liquidate the company, to entitle you to claim from the Redundancy Payments Office.

If you make a claim from the Redundancy Payments Office, following the company going into an insolvency procedure, the RPO usually turn claims around in approximately one month. This may take longer if there is any dispute with your claim (such as you are claiming more than the company say that you are owed).

How long will it take for pay in lieu of notice to be paid out?

Claims for notice pay take a while longer. This is because the period of notice needs to expire before they will pay you. So, if you have 12 weeks notice, you will not receive your notice pay until after this period. Please note that you will only receive notice pay for the period that you are out of work, so if you start a new job , the notice pay will only go to the date of your new employment.

An example

Amanda is laid off because the company has gone into liquidation. She makes her claim to the redundancy payments office and has 11 weeks notice to claim.
After 4 weeks, Amanda finds employment elsewhere.

The notice pay that the redundancy payments office will pay out will be the 4 weeks that Amanda was out of work.

The redundancy payments office will only pay this after the notice period has expired (i.e. after 11 weeks).

The money that has been paid into a company pension by your employer (your contribution and their contribution) will stay in the pension – it is not lost. When it comes to the point you can draw this, you will be able to do so. You can also look into transferring the amount into another pension if you wish to do so, but I would recommend taking advice from a Financial Advisor about this.

If the company goes into an insolvency procedure (i.e. liquidation or administration), the redundancy payments office will pay unpaid contributions, for a period of 12 months prior to the insolvency,to the pension company. The company dealing with the insolvency procedure will take care of this.

If the company goes into an insolvency procedure, such as Liquidation, Administration or a Company Voluntary Arrangement (CVA) you will be able to claim for these from the Redundancy Payments Office.

You should be sent details from the Insolvency Practitioners office dealing with the claim, but more information and the link to make your claim can be found here.

You may have expenses that have not been paid, such as a claim for mileage or out of pocket expenses. This is a claim against the company you were employed by and unfortunately, you will be an unsecured creditor for this, ranking with all the other unsecured creditors in the Liquidation/Administration.

This means that you will need to lodge your claim with the firm dealing with the insolvency and wait to see if a dividend is paid to unsecured creditors.

If a charity cannot pay its debts as and when they fall due, or is insolvent on its balance sheet, it can be liquidated, and follows the same Insolvency Act and Rules as a Creditors Voluntary Liquidation.

If the charity is registered at Companies House it can be liquidated when it ceases to trade. A solvent Liquidation (i.e. where there are more assets than liabilities) will be liquidated using the Members Voluntary Liquidation route. However, unlike an MVL of a limited company, the excess of assets will not be distributed to the “members”, but will go to another charity.

If the charity is insolvent (i.e. does not have enough assets to cover its liabilities, it will be liquidated using a Creditors Voluntary Liquidation.

There are many occasions where customers will pay a deposit for goods or services, and these are not supplied due to the company ceasing to trade and going into an insolvency procedure. Where does this leave the deposit payers? If the payment was made by credit card or a finance agreement, such payments may be covered by Section 75 of the Consumer Credit Act, which may be recoverable from the bank or finance provider.

This means that the credit card or finance company has equal responsibility (and therefore liability) as the seller, should a problem arise which results in the seller failing to supply the goods or services, or should the seller supply something that is not to standard.

Therefore, if you paid by credit card or used a finance facility you should make a claim against your credit card or finance company.

You should:

1. Write to the credit card or finance company, stating what you bought, where and when you bought it and how much you paid. Include copies of receipts if you have them (if not, you will need to send some other proof of purchase).

2. Tell them that the company you purchased from has not supplied the goods/services and include any notices of the cessation to trade (or notices of liquidation or other insolvency procedure).

3. Explain that you would like to receive a refund of the purchase price/deposit (the amount you paid) and include “I am making a claim under Section 75 of the Consumer Credit Act”.

Unless you have an insurance backed warranty, any warranty of a company that ceases to trade will not be worth the paper it is written on.

The only exception to this would be if another company agreed to take on and honour any warranties.

If it is an insurance backed warranty, you will make any claims against the company named on the warranty documents, by contacting them and evidencing what your claim is for.

If you do have a defective product, such as leaking windows and the window company has gone into liquidation (and you do not have an insurance backed warranty), you will have to get another company (or individual) to put the issue right and you will need to pay them for doing this. You can then claim in the Liquidation for the expense of correcting this. However, you will rank alongside any other unsecured creditor and will only receive any money back if a dividend is paid to unsecured creditors.

Unless your guarantee is backed by another company, any guarantee of a company that ceases to trade (and goes into liquidation) will not be worth the paper it is written on.
The only exception to this would be if another company agreed to take on and honour any guarantees.

If you do have a defective product, such as leaking windows and the window company has gone into liquidation (and you do not have an insurance backed warranty), you will have to get another company (or individual) to put the issue right and you will need to pay them for doing this. You can then claim in the Liquidation for the expense of correcting this, however you will rank alongside any other unsecured creditor and will only receive any money back if a dividend is paid to unsecured creditors.

Many creditors’ meetings are held remotely, via Microsoft Teams, Skype, Zoom or some other electronic means. If you want to vote, but do not want to attend the meeting, you can do so by completing a proxy form. On the proxy form, you can state how you want to vote. You will also need to complete and send a proof of debt form for your vote to be quantified. See the downloadable form below:

Proof of Debt Form
Proxy Form

Usually, the creditors meeting is held to appoint a Liquidator of the company. This is usually a virtual meeting.

The proposed liquidator will normally conduct the running of the meeting.

The normal course of actions is:

• Introductions
• The Liquidator (or a representative) will normally advise that they have been appointed as Liquidator of the company by the shareholders at an earlier meeting.
• The Liquidator (or representative) will go through the director’s report
• The Liquidator (or representative) will explain the Statement of Affairs (i.e. list of assets and liabilities) and the deficiency account.
• The Liquidator (or representative) will briefly explain what they are to do, including a description of the investigations that they are obliged to undertake and report to the Insolvency Service (Government Department).
• The Liquidator (or representative) will advise of any assets realised and/or expenses incurred since the appointment as Liquidator (by the members).
• The Liquidator will make creditors aware of any prospective sales (including to related parties).
• If there are 3 or more creditors (not more than 5) who want to be part of a liquidation committee, a committee may be formed. If there are more than 5, votes will be cast and counted.
• The Liquidator will ask creditors for their questions or comments.
• The Liquidator will put resolutions to creditors for voting and will count the votes.
• The Liquidator will confirm the result of the votes and confirm whether they were appointed as liquidator buy the creditors (or advise of who the Liquidator will be).

You will receive a notice from the proposed liquidator of how to vote and the deadline for submitting the votes. If you wish to appoint an alternative Liquidator, you will need to ensure that the person you wish to nominate is willing to act before submitting the nomination. From this point, the Liquidator that you are nominating should make sure that you are able to complete the paperwork required. In reality, this is just the proxy form and proof of debt form, (see the factsheet section), but the Liquidator you nominate would more than likely want to attend the (virtual) meeting.

You can nominate a Liquidator at the initial meeting, and the Liquidator will be appointed based on the amount of the votes cast. If you want to replace a Liquidator, you can always request that a creditors meeting is held to remove the current liquidator and replace them with the one you wish to act. You will need to cover the costs of the creditors meeting and will need to have 25% in value, of creditor’s claims for this.

When you are notified of a meeting of creditors, forms will be sent to creditors to determine whether you wish to provide a nomination to be on a committee. Voting will be cast at the meeting if there are at least 3 but not more than 5 nominees. It is, therefore, a good idea for the nominated committee member to attend the virtual meeting.

A creditors’ committee is there to represent all creditors and will often influence how the Liquidator (or other procedure) will act and they will set how they are remunerated. There is a guide to creditors committees attached here.

If the company that you supply to goes bust without paying for the items that they received, you may be able to claim title to the goods you provided. This is known as a retention of title claim.

To have a valid claim, you will need to have had the ability to retain title to the goods in the event of non-payment, within your terms and conditions. This acceptance of the terms and conditions needs to have been done before you supplied the customer the goods.

If you have a valid title, then the next step is the identification of your goods. You need to show that you (and only you) provided these items. Serial numbers, branding, batch numbers etc all help in this respect. Ask to go to the site to carry out the identification. Any items identified will be put to the side. If you provide something like potatoes that go into a storage container, you will have no way of identifying that these were in fact supplied by you. However, if you were the only supplier of potatoes, then it is most likely that this would be accepted. You need to ask whether you are the sole supplier.

The retention of title clause built into your terms and conditions will determine whether you need to identify your items to unpaid invoices (serial numbers are the best way for this) or as items you supplied at some point in time, which is if you have an “all monies clause”.

If you are a supplier reading this, it is probably worth taking advice to make sure your terms and conditions contain the right clauses and are communicated and accepted. It is always better to be prepared.

Click here for a factsheet on this subject.

A proxy form is completed to let the convener of a meeting know who is going to attend (or represent creditors) and how they should vote on any resolutions presented to the meeting.

Proxy Form

If you are a creditor of a company, you will need to register your debt with the Liquidator/Administrator/Trustee and this is done on a proof of debt form. On receipt of a proof of debt form, your claim will be registered against the person or company that is insolvent and the amount you claim will either be accepted or rejected. If it is accepted, this is the amount that will be used for your votes and to base your dividend on, should one become payable.

You need to look at all your liabilities (monies your company owes) and work out whether you have a viable business going forward. If you have a viable business and this is a temporary blip caused by the Covid uncertainty, then I would suggest that you contact the bank and ask for a payment holiday. If you do not have a viable business or are in any way unsure, the you should take insolvency advice.

The furlough scheme will be tapered from 1 July 2021 to wind down

July 2021 - employers will have to pay 10% of the furloughed workers usual wage (plus tax, NI and pension)
August 2021 - employers will have to pay 20% of the furloughed workers usual wage (plus tax, NI and pension)
September 2021 - employers will have to pay 20% of the furloughed workers usual wage (plus tax, NI and pension)

It is scheduled to end on 30 September 2021, but has been extended before - so watch this space.

It is a scheme that supports the re-opening of businesses as the Covid 19 restrictions are lifted.

It is available to rate-paying companies based in England, that are in the non-essential retail, hospitality, accommodation, leisure, personal care or gym sectors, as long as they were trading on 1 April 2021.

Eligible businesses will be paid a one-off grant of up to £6,000 in the non-essential retail sector or a one-off grant of up to £18,000 in the hospitality, accommodation, leisure, personal care or gym sectors.

On June 2021 business rates exceptions for businesses in retail and hospitality in England will cease. This will be followed by 60% business rates relief for the period from 1 July 2021 to 31 March 2022, capped at £2m per business. This applies to properties that were required to be closed on 5 January 2021, or £105,000 per business for other eligible properties

HM Revenue and Customs will allow businesses to enter into a 12 month payment plan for the Covid deferred VAT. This can be accessed from the Government Gateway. You will need to pay other VAT liabilities as and when they are due to be paid. If you are struggling to pay the VAT in general, you should seek help.