A winding-up petition asks the court to close an insolvent company that owes you money. It is a serious, costly and public step — powerful against a company that can pay but will not, and the wrong tool for a debt that is disputed or a company that simply cannot.
A winding-up petition asks the court to place a company into compulsory liquidation because it cannot pay its debts. For a B2B debt you usually reach it after an unpaid statutory demand for more than £750 that has gone unanswered for 21 days. It is a serious, public step and is only for a clear, undisputed debt — a County Court claim is the route for anything in dispute.
A petition sits at the far end of the recovery path. For a B2B debt the usual road runs through a statutory demand first.
The common route is: a reminder, then a Letter Before Action, and — where the debt is clear and undisputed — a statutory demand for more than £750. If the company neither pays nor challenges the demand within 21 days, that non-payment can be used as evidence that it cannot pay its debts, which is the ground for a winding-up petition. A judgment that has gone unpaid can serve the same purpose.
Presenting the petition is a formal court step with its own upfront costs — a court fee plus a deposit towards the Official Receiver’s costs, which together run into four figures. Check the current figures on GOV.UK before you start. RobinReturn prepares the earlier documents — the reminder and the Letter Before Action; a winding-up petition is a separate insolvency step you would take with your own legal advice.
The consequences are severe, which is exactly why the threat can move a company that is able to pay.
Once a petition is presented it is advertised in The Gazette. Banks routinely freeze the company’s accounts at that point, which can bring trading to a halt. A company that can pay often settles quickly to stop the process; a company that cannot may be wound up by the court and placed into compulsory liquidation.
Liquidation is a collective process. A liquidator gathers in the company’s assets and shares them among all its creditors in the order the law sets — so if the company is genuinely insolvent, you may recover only part of what you are owed, or nothing. A petition is a way to apply pressure or to close an insolvent company; it is not a private tool for collecting one invoice.
This is the mistake that turns a petition into a costs order against you. Get it right before you present one.
A winding-up petition is only for a debt that is clear, due and not genuinely in dispute. If the company has a real dispute or a cross-claim, presenting a petition can be treated as an abuse of process: the company can ask the court to restrain or dismiss it, and you can be ordered to pay indemnity costs. Where there is any genuine argument about whether the money is owed, a County Court claim is the right route.
For most overdue invoices the cheaper, lower-risk first move is still a reminder and then a Letter Before Action. New to the terms here? See the glossary, or read the full recovery process.
A winding-up petition is an application to the court to close a company down — to place it into compulsory liquidation — on the ground that it cannot pay its debts. For an unpaid B2B invoice it is a creditor's insolvency route, separate from a County Court money claim, and it is only appropriate where the debt is clear and undisputed.
The debt must be more than £750 and the debtor must be a company. A winding-up petition is the company route; the equivalent step against an individual or sole trader is a bankruptcy petition. The debt must be a definite sum that is due now.
Not necessarily. A common route is an unpaid statutory demand: if a company does not pay or challenge a statutory demand for more than £750 within 21 days, that non-payment can be used as evidence it cannot pay its debts, which grounds a petition. You can also rely on a judgment that has gone unpaid. Either way, the debt must be undisputed.
No — this is the central risk. A winding-up petition is only for a clear, undisputed debt. If the company genuinely disputes it or has a real cross-claim, the court can treat the petition as an abuse of process, restrain or dismiss it, and order you to pay costs. Where a debt is disputed, a County Court claim is the right route, not a petition.
No. A statutory demand is the formal 21-day warning that can come before a petition; a County Court Judgment confirms the debt is owed; a winding-up petition is a separate insolvency proceeding that asks the court to liquidate the company. It is a collective process — if the company is wound up, its assets are shared among all creditors, so you may recover only part of what you are owed.
A petition is a heavy, late-stage tool. For most overdue invoices a reminder and a Letter Before Action recover the money sooner and at far less risk. RobinReturn is not a law firm and does not give legal advice.