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Expert guidance on liquidating your hotel or hospitality company

The COVID-19 pandemic has had a devastating impact on the hospitality industry in the UK. Despite a brief resurgence in the summer of 2020, many businesses continue to struggle financially. If you run a hotel or work in the hospitality sector, it’s crucial to seek expert advice from a licensed insolvency practitioner to determine your options for liquidation.

What has led to the significant impact on hotels and hospitality businesses?


Future restrictions and virus worries causing unpredictability have led to a decrease in bookings in the hospitality industry. Remote technology is replacing in-person business travel and contributing to the decline.

Urgent consultation with an expert insolvency practitioner is key to navigating a difficult business situation – liquidation may be a solution, but there could be alternatives. Restructuring your company could allow it to persist without its problematic aspects, leading to a more efficient and flexible business model that can handle challenging market conditions.

Expert guidance for hotels and hospitality businesses on the liquidation process


Get the support you need for your struggling hotel or hospitality business with . Our expert guidance will give you a clear picture of your financial standing and help you make informed decisions for the future.

Closing your business through a Creditors’ Voluntary Liquidation process is the right way to go if liquidation is your only option. This will guarantee that your company’s closure adheres to insolvency laws, shielding you from wrongful trading accusations.

Entering into a CVL process may result in redundancy pay for eligible staff, including directors who have worked as employees of the company.

Creditors’ Voluntary Liquidation – A Solution for Struggling Hotels & Hospitality Businesses

As a director of a company, the decision to initiate a Creditors’ Voluntary Liquidation (CVL) process lies with you. This means that you have the power to choose the appropriate time to commence the liquidation process and select the liquidator who will carry it out. It’s crucial to note that CVL is a formal procedure that can only be executed by a licensed insolvency practitioner (IP), who is authorised by the relevant regulatory body.

In summary, the liquidator will have the assets of the company evaluated professionally, then sell them through a public sale. After the sale, all proceeds will be distributed among creditors according to the legally mandated priority.

Once all assets have been sold and the proceeds have been distributed among creditors, any outstanding debts can be discharged in a CVL unless a personal guarantee was given. In that case, the director would be responsible for repaying the remaining debt personally.

Pursuing Director Redundancy After Liquidation


As previously discussed, if you’re a company director and your business undergoes liquidation, you may be eligible to receive redundancy pay and other statutory benefits. Eligibility criteria include:

  • Holding a contract of employment with the company for at least 2 years
  • Receiving a regular salary via PAYE
  • Working a minimum of 16 hours per week
  • Having a debt owed to you by the business, such as your initial investment
  • Filling a role beyond an advisory capacity.

Remember, liquidation is not the only solution. Before choosing this option, explore if there are ways to save your business.

Saving Struggling Hotels and Hospitality Companies in Financial Difficulty have a professional team that can help in finding the best solution for your struggling hotel or hospitality business. One possibility may be to reorganise your debts through a Company Voluntary Arrangement (CVA), which is a legally binding agreement.

To revive your struggling business, consider streamlining operations by cutting out factors contributing to financial decline. Restructuring may include layoffs, but a leaner business can better withstand pandemic challenges.

Get reliable liquidation guidance for your hotel or hospitality business. Contact and have a partner-led team evaluate your situation with a free, same-day consultation. Benefit from our extensive UK-wide network of offices.

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