This is the first article in ‘Back to Basics’, a series of articles looking at insolvency processes in Scotland. In this article I examine the court process for winding up a company.
A winding up petition is a form of legal action that can be used when a company is unable to pay its debts as they fall due. Sections 122 to 124 of the Insolvency Act 1986 (the Act) deal with how to wind up a company in Scotland.
When is a company deemed unable to pay debts?
Section 123 of the Act states that a company is deemed unable to pay its debts if:
a) the company owes more than 750 and has failed to comply with a statutory demand served on the company requiring payment to be made within 21 days;
b) a charge for payment has been served on the compa…
Read the full article at: https://www.shoosmiths.co.uk/insights/articles/insolvency-in-scotland-back-to-basics-part-1-winding-up