Can You Start A New Business After Liquidation

Exception 1 if you have been the director of a company with the same or a similar name to the liquidated company which was trading 12 months before the liquidation of the old.

Can you start a new business after liquidation. Restrictions on re use of a company name as a director of a limited company which has been placed into insolvent liquidation you are restricted from using the same name or a name so similar to suggest an association under section 216 of the insolvency act 1986. Tax or employer identification numbers. This is also known as a phoenix company.

If however you are going for a business loan then it is much more likely to come to light. If you want to start a new company after insolvent liquidation and you would like to use the same or a similar company name there are some exceptions to section 216. This is to ensure that directors are not running up debts entering liquidation and starting a new company following the same circle.

A person company can purchase the whole business including the trading name under arrangements made by the insolvency practitioner appointed to it. There is no rule that a new business cannot be started after a chapter 7 bankruptcy and liquidation. However if you want to start a new company using the same or similar name as the liquidated company there are certain restrictions.

Insolvency legislation prevents the same name or similar name being used again but there are exceptions to the rules. Provided you have nothing to do with the existing company such as being a director then you will not be impacted by the liquidation and you can start up a new business. In essence there is nothing to stop you setting up a new company just because a previous one under your control has gone into liquidation.

Usually starting afresh and creating a new name is a better idea than using the old since you don t want any negative credit information to taint the new business if you can avoid it. If you closed a previous business you can t start the new business with the same tax or employer identification numbers. The entrepreneurial culture in the uk encourages talented business owners to continue to take forward their ideas even if they have been the owner of an unsuccessful business in the past.

The simple answer to this is yes. If a company purchases the whole or a substantial amount of the liquidated company a similar name may be used providing all stakeholders are notified of the intention. Here are a few other things you ll want to think about before starting your new business after bankruptcy.