What will it cost?
Upwards of £15,000.00 plus VAT
Most IPs will offer an initial meeting for free and a small fixed fee for additional meetings and time spent in dealing with matters prior to the administration taking place.
In a pre-pack situation a lot more involvement is required prior to the appointment of the administrator in order to be able to complete the contract on day one of their appointment.
Post administration, the administrators costs are approved by the creditors. They are most commonly on a time spent basis, so the more work there is to do, the more it will cost.
Insolvency practitioner costs
IP costs vary from firm to firm;
On average £5,000.00 to £10,000.00 plus VAT for the IPs pre appointment costs.
Upwards of £5,000.00 plus VAT for the administrators’ post appointment costs.
If there are any fixed assets to be dealt with where there are secured creditors in place, such as property with mortgages on then the chargeholder will agree the administrators costs in dealing with the sale of the asset.
Administration procedures are generally expensive because the administrator takes control of the company’s affairs and usually trades the business, which will be time consuming.
Legal, agent & court costs
In additional to the IPs costs legal and court costs upward of £2,000.00 plus VAT will be incurred together with agents fees which will vary depending on the amount and value of the assets involved but will be upwards of £1,000.00 plus VAT.
VAT on post administration payments are usually recoverable on the post administration payments if the company was VAT registered.
Pre appointment VAT incurred is included in the company’s VAT returns in the usual way and often offset against any other crown debts due to HM Revenue & Customs.