If your company has no money in the bank, it can feel like every route is blocked. You may know the business cannot continue. You may also know it cannot pay HMRC, suppliers, wages, rent or loan repayments. But if there is no cash available, how can you pay for liquidation?
The good news is that you are not automatically stuck, and may still have options. But it is important to act carefully, because ignoring the situation can make creditor pressure worse and may increase the risk to you as a director.
Can You Liquidate a Company with No Money?
Yes, it may still be possible to liquidate a company with no money. The right route depends on your company’s full position, including its debts, assets, creditors, trading status and whether any funding options are available.
When people search for liquidation with no money, they usually mean one of three things:
- The company has no cash in the bank.
- The company has debts it cannot pay.
- The director cannot personally afford to fund a liquidation.
These are common situations. They are also situations where you should take advice before making any big decisions.
A company does not always need a healthy bank balance for liquidation to be considered. In some cases, company assets may help fund the process. In others, there may be director redundancy options, staged payment discussions or a different insolvency route. The key point is that you need a clear review before deciding what to do next.
According to official insolvency statistics, there were 2,085 registered company insolvencies in England and Wales in April 2026. Of these, 1,510 were creditors’ voluntary liquidations, known as CVLs. This shows how common voluntary liquidation has become for companies that cannot continue.
Is Your Company Insolvent?
A company is usually insolvent if it cannot pay its debts when they fall due, or if its liabilities are greater than its assets.
This means the company may be insolvent if:
- HMRC arrears are building up.
- Suppliers are overdue and chasing payment.
- Wages, rent or loan repayments cannot be met.
- There is no realistic cash coming in.
- The company owes more than it owns.
- You are using new credit to cover old debt.
If this sounds familiar, you should pause before taking on more debt or making selective payments. When a company is insolvent, your duties as a director change. Your focus needs to move towards protecting creditors and avoiding further losses.
If you are unsure where you stand, our guide to UK insolvency explains the main warning signs and formal options.
If your company is in financial difficulty, talking to a licensed insolvency practitioner can help to clarify your options. Speak to Anderson Brookes today by calling 0800 1804 935 or via email at advice@andersonbrookes.co.uk.
Why Waiting Can Make Things Worse
Many directors delay because they think they cannot afford a CVL. It’s understandable to think this way: if the company has no money, it may feel impossible to do anything. In reality, however, delay can reduce your options.
Creditors may continue to add pressure. HMRC may issue further demands. Suppliers may threaten legal action. A creditor may even start winding-up action, which could push the company into compulsory liquidation.
Waiting can also make director conduct harder to explain. If the company carries on trading when there is no realistic prospect of recovery, creditor losses may increase. That can lead to more difficult questions later.
The Insolvency Service says directors of insolvent companies should protect company assets, treat creditors fairly, avoid worsening creditor losses and seek professional advice before deciding your next step.
What Are the Options for Companies with No Cash?
There is no single answer for every company. A short conversation with a licensed insolvency practitioner can usually narrow things down quickly.
Here are the main areas to look at.
Check whether the company has assets
A company can have assets even when the bank account is empty. Assets may include:
- vehicles
- tools or equipment
- stock
- machinery
- office furniture
- unpaid customer invoices
- cash owed to the company
- deposits or refunds due back
- intellectual property or website assets
If assets exist, they may help pay towards the liquidation. But they must be handled properly. You should not sell or transfer assets without advice, especially if the company is insolvent.
Selling company assets for less than they are worth, transferring them to another business, or using the proceeds to pay one creditor over another can create problems. Get advice before taking action.
Consider whether a CVL is still possible
A CVL is often the most controlled way to close an insolvent company. It allows directors to take action voluntarily, rather than waiting for a creditor to force the issue.
In a CVL, a licensed insolvency practitioner is appointed as liquidator. The company usually stops trading. The liquidator deals with creditors, reviews assets, handles statutory duties and brings the company’s affairs to a formal close.
If the company has no money in the bank, a CVL may still be possible if there are assets, recoveries or another suitable funding route. At Anderson Brookes, we can review the position and explain whether a CVL is realistic, what it would cost and how the process may be funded.
A CVL is not the only option, but it is often worth considering early because it gives you more control than waiting for compulsory liquidation.
Ask whether director redundancy may apply
Some directors are also employees of their company. If that applies to you, you may be able to claim redundancy and other statutory payments after liquidation.
This is not automatic. You need to meet the relevant criteria and provide evidence. The Insolvency Service may look at things such as whether there was an employment contract, how you were paid, how many hours you worked and whether PAYE records support the claim.
The government guidance on director redundancy payments explains that a director can also be an employee and may be eligible if they can support their claim.
This can sometimes help directors who have no personal funds available. But you should not rely on it without advice.
Be careful before paying creditors personally
When pressure builds, it is tempting to pay whoever is shouting the loudest. You may think paying HMRC, a key supplier or a lender personally will buy time.
Sometimes personal payments create more problems than they solve.
Before paying company debts from personal funds, check whether there are personal guarantees, whether the payment would prefer one creditor over another, and whether the company has any realistic chance of recovery.
If the company is insolvent, the safest next step is usually to get advice before moving money.
What If HMRC Is the Main Creditor?
HMRC is one of the most common creditors in company insolvency. VAT, PAYE, NIC and corporation tax arrears can build quickly, especially when cash flow has been tight for months.
If you can’t pay tax, it is important to understand your options before enforcement escalates. HMRC may agree a payment plan if the company can afford regular repayments. This is often called Time to Pay.
However, Time to Pay only works if the company can keep up with the arrangement and pay future taxes on time. If there is no realistic way to repay the arrears, liquidation may need to be considered.
This is especially important where there are PAYE and NIC arrears or corporation tax arrears. These debts should not be ignored. HMRC can take further action if the company does not engage or cannot agree a workable plan.
Speaking to us early can help you understand whether HMRC pressure can be managed, whether a payment plan is realistic, or whether formal insolvency is the more sensible route.
What Happens to Company Debts in Liquidation?
In liquidation, the company’s debts are dealt with by the liquidator. They will review the company’s assets and liabilities. Any company assets are realised where possible. Creditors are then paid in the correct legal order, if there is money available.
In many cases, unsecured company debts that cannot be paid are written off when the company is dissolved. This can include trade debts, loans, rent arrears and some HMRC debts.
There are exceptions, however. You may still be personally liable if you signed a personal guarantee. An overdrawn director’s loan account may need to be repaid. Director misconduct can also create personal risk in serious cases. Our guide to debts in liquidation explains this in more detail.
The important point is that limited company debts usually belong to the company, not you personally. Nevertheless, you should always check your own position before assuming that all debts will end with liquidation.
Could You Strike the Company Off Instead?
Strike-off is not usually suitable if the company is insolvent and still owes money.
A company strike-off is designed for companies that can be closed cleanly. If there are unpaid creditors, HMRC arrears, unpaid loans, unresolved disputes or ongoing trading issues, creditors may object.
Trying to dissolve a company with debts does not usually deal with the underlying problem. It can delay matters and may lead to further questions.
If your company has no money and cannot pay its debts, take advice before applying for strike-off. It may be the wrong route.
What Should You Do Now If the Company Has No Money?
You do not need to solve everything today. But you should avoid drifting.
Start with these steps:
- Stop and review the company’s position.
- Make a list of all debts, including HMRC, suppliers, rent, loans and wages.
- List any assets, even if they seem small.
- Check whether you have signed personal guarantees.
- Check whether there is an overdrawn director’s loan account.
- Avoid taking on new credit without advice.
- Keep clear records of decisions.
- Speak to a licensed IP before creditor pressure grows.
A licensed insolvency practitioner can explain what is safe, affordable and realistic. They can also tell you what not to do, which is often just as important.
How Anderson Brookes Can Help
At Anderson Brookes, we help directors deal with insolvent companies in a calm, practical way.
We will look at the company’s debts, assets, creditor pressure and funding position. We will explain whether liquidation is appropriate, whether a CVL is possible, whether HMRC options should be explored, or whether another route may be better.
There is no judgment. Many directors come to us after months of stress, sleepless nights and creditor pressure. Our job is to help you understand your options and move forward.
We can help with:
- company liquidation
- HMRC arrears
- Bounce Back Loan and business loan concerns
- creditor pressure
- director redundancy guidance
- limited company debt advice
- formal insolvency options
If liquidation with no money is your main concern, speak to us before assuming there is no way forward.
FAQs About Liquidation with No Money
Can I liquidate my company if there are no assets?
Yes, it may still be possible. The options depend on the company’s debts, creditors, records and whether any funding route is available. The first step is to have the position reviewed.
Who pays for liquidation if the company has no money?
Liquidation may be paid for from company assets, recoveries, director funds, staged payments or other suitable sources. Some directors may also be eligible for redundancy payments, although this is not guaranteed.
Can HMRC force my company into liquidation?
Yes. HMRC can take enforcement action and may petition to wind up a company if debts are not dealt with. If HMRC is chasing, early advice is important.
Will I personally owe the company’s debts?
Usually, limited company debts belong to the company. But there are exceptions. You may be personally liable if you signed a personal guarantee, have an overdrawn director’s loan account, or if there has been misconduct.
Is compulsory liquidation better if I cannot afford a CVL?
Not usually. It may feel easier to wait, but compulsory liquidation gives you less control. It can also increase stress and creditor pressure. A voluntary route is often better if it is available.
Can I start again after liquidation?
Often, yes. But there are rules around reusing a company name, buying assets and starting a new business after liquidation. You should take advice before setting up or trading through another company.
Get Help Before Pressure Builds
If your company has no money in the bank, you may still have options. The worst thing you can do is ignore the problem and hope it goes away.
Speak to Anderson Brookes today for clear, confidential advice from a licensed insolvency team. We will explain what is possible, what to avoid, and the safest next step for you and your company.
Call us today on 0800 1804 935, email us at advice@andersonbrookes.co.uk or contact us online.