Company administration is a formal insolvency procedure that protects financially distressed companies from creditor action while a licensed Insolvency Practitioner explores options to rescue the business. Administration provides immediate legal protection through a moratorium, giving companies breathing space to restructure, find a buyer, or achieve better outcomes for creditors than immediate liquidation.
Administration is a formal insolvency procedure regulated by the Insolvency Act 1986 that gives your company breathing space while an appointed administrator works to rescue the business, achieve a better outcome for creditors, or realise assets in an orderly manner.
Once administration begins, a legal moratorium comes into effect, providing immediate protection from creditor legal action. This means creditors cannot enforce winding-up petitions, take legal proceedings, or repossess assets without the administrator's consent or court permission. This breathing space allows the administrator to assess the situation and implement the best strategy for your company.
The administrator, who must be a licensed Insolvency Practitioner, takes control of the company and manages its affairs with the objective of rescuing it as a going concern where possible. If rescue isn't viable, the administrator will seek to achieve a better result for creditors than immediate liquidation, or realise the company's assets to repay creditors.
Administration is often used when a business is fundamentally viable but needs protection from creditor pressure to restructure, find a buyer, or implement a turnaround plan.
You should consider administration if your company is facing any of these situations:
The earlier you seek advice, the more options are typically available to rescue your business.
The administrator can be appointed by court order, by the company directors (if certain conditions are met), or by a secured creditor with a qualifying floating charge. In urgent situations, an administrator can be appointed within 24-48 hours.
Legal protection from creditor action takes effect immediately upon appointment. Creditors cannot pursue legal action, enforce debts, or repossess assets without permission. This provides crucial breathing space.
The administrator prepares detailed proposals outlining the strategy for the company. This may involve trading the business, seeking a buyer, implementing a Company Voluntary Arrangement (CVA), or realising assets.
The administrator executes the approved strategy, whether that's rescuing the company, selling the business as a going concern, negotiating with creditors, or realising assets in an orderly manner to maximise returns.
The company exits administration through one of several routes: successful rescue and return to director control, sale of the business, transition to a CVA, move to solvent or insolvent liquidation, or dissolution if there are no assets.
Company administration provides vital protection for businesses in financial distress, creating a legal shield that prevents creditor action whilst you explore rescue options. This formal insolvency procedure gives your company immediate breathing space, halting winding-up petitions, enforcement action, and legal proceedings from creditors.
Benefit
What this means for you
Immediate creditor protection
Legal protection from creditor action and winding-up petitions takes effect as soon as the administrator is appointed
Prevents asset repossession
Legal action and asset repossession are halted, protecting your business property and equipment
Time to restructure
Breathing space to implement a turnaround plan or find a buyer without constant creditor pressure
Job protection
Potential to save jobs and preserve business operations rather than immediate closure
Professional management
Licensed Insolvency Practitioner manages the process with expertise and objectivity during the crisis period
Maximised returns
Better outcomes for creditors compared to immediate liquidation, which can reduce personal director liability
Business value preservation
Allows orderly sale as a going concern rather than forced asset disposal at reduced values
Flexible outcomes
Multiple exit routes available including rescue, sale, CVA, or structured wind-down depending on circumstances
Administration requires swift action and specialist expertise. Immediate protection from creditor action can often be arranged within 24-48 hours of initial contact.
Our licensed Insolvency Practitioners have extensive experience guiding companies through administration across all sectors, from small businesses to large corporate entities. They understand the urgency of your situation and will provide confidential, practical advice on whether administration is right for your circumstances.
Find your local licensed Insolvency Practitioner today for same-day professional guidance.
How long does Company Administration last?
Administration typically lasts up to 12 months, though this can be extended with creditor consent or court approval. The timeframe depends on the complexity of the case and the strategy being implemented. Some administrations conclude within a few months if a quick sale or rescue is achieved.
Can my company trade during Company Administration?
Yes, in many cases. The administrator will assess whether continued trading is beneficial for creditors and stakeholders. If the business is viable and trading preserves value, the administrator will continue operations while implementing the rescue or sale strategy.
What happens to employees during Company Administration?
Employees usually continue working if the business continues trading. The administrator has the power to retain staff necessary for the business. If redundancies are required, employees have statutory protection and may be entitled to claim redundancy payments and other entitlements from the Redundancy Payments Service.
Who appoints the Administrator?
An administrator can be appointed by the company directors (using a Notice of Intention to Appoint), by a secured creditor with a qualifying floating charge, or by court order. In urgent situations, directors can often appoint an administrator out of court within 24-48 hours.
Can Administration save my business?
Administration can save viable businesses that need breathing space from creditor pressure. The success depends on factors including the underlying business model, market conditions, level of debt, and creditor support. Your Insolvency Practitioner will provide an honest assessment of rescue prospects during your initial consultation.
What are the costs of Company Administration?
Administration costs vary depending on the complexity of the case, size of the company, and work required. The administrator's fees and expenses are typically paid from company assets as a priority expense. Your Insolvency Practitioner will provide a transparent fee estimate during your initial consultation.
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Insolvency Practitioners is a trading name of BTG Begbies Traynor (Central) LLP a limited liability partnership registered in England and Wales No. OC306540. The firm is authorised by the FCA to undertake debt counselling and debt adjusting and its reference number is 660455. Copyright 2026 Insolvency Practitioners, all rights reserved.