Can my creditors close my company?


Creditor pressure is a common sign your company is struggling to stay on top of its debts. Said pressure can be concerning for the owners of these businesses, who might even ask; ‘can my creditors close my company?’

Prompts and reminders

If your limited company owes a creditor money, they’re within their right to send reminders by phone, post, or email. While these can be alarming, the reminders only become harassment if they’re excessive or aggressive, or if they arrived through multiple avenues multiple times per day. Another example of harassment would be chasing you for a business-related debt through personal contacts or at your home address. If you ignore the reminders or don’t respond within the time specified, the creditors can take things further.

It’s best to tackle the issue at this stage before it escalates. Discuss your options with a licensed insolvency practitioner who can advise you the best way forward for you and your business.

Court action

Ignoring the reminders may lead to court action. Creditors can apply for a County Court Judgement (CCJ), which will stay on your credit file for six years if you don’t repay within 30 days of the date stated in the judgement. Having a CCJ on your credit file negatively impacts your credit rating, making it harder to secure funding. They can also lead to higher interest rates on funding you do secure. You can either pay the CCJ in the allotted timeframe, or if you don’t owe the amount stated, file a dispute.

Whatever you do, don’t ignore a CCJ. If you do, bailiffs can visit your premises and take assets equal to the debt’s value.

Winding-up and closure

If reminders, court action and even visits from bailiffs don’t convince you to pay, your creditors can issue a winding-up petition. A winding-up petition is the most severe form of creditor action for debts exceeding £750. If these petitions go unchallenged, they can result in a winding-up order. The company bank accounts will freeze, and unless you can obtain a validation order, the company can’t trade and will close.


Ignoring creditor pressure can ultimately lead to your company closing. Once your creditors start sending prompts and reminders for debts you can’t repay, you should act fast before the action escalates. Simply hoping it will go away without seeking help or taking the necessary steps to repay can lead to court action, and visits from bailiffs before a winding-up petition. The petition can lead to a winding-up order, which ends all trade by freezing the company’s bank accounts. Seek advice from a licensed insolvency practitioner before your debts threaten your company’s future.