“My name was still on it — whatever happened next.”
Nick and I had built the training company together, but by the time we were separating, I didn’t trust what was happening with the finances — or what I’d signed up to as a director.
Our marriage had broken down and with it any real communication about the business. I had no visibility of the company accounts. I felt Nick was treating the business bank account as his own, and I’d made it clear: sort it out. But I was still on the Companies House register. I still had legal responsibilities. Walking away wasn’t as simple as I wanted it to be.
What made it worse was that I hadn’t chosen to be in this position. The company was Nick’s problem to resolve — that was my view, and I’d said so. But a directorship doesn’t dissolve because a marriage does. Whatever was owed, whatever decisions were made, my name was on them too. I needed to know that someone was looking after my position, not just his.
Our accountant referred us to an insolvency practitioner, who told us the company needed to go into liquidation. We didn’t ask many questions — we just wanted it over. Nobody mentioned a director’s loan account. Nobody mentioned that Nick would personally have to repay the £30,000 he had drawn. We were already moving towards signing the engagement letter when a friend intervened.
He’d been through a liquidation himself and hadn’t come out well. He’d ended up filing for bankruptcy — and Lightside had helped him through it. He told us not to sign anything until we’d spoken to them first.
The Outcome in brief
Adviser: Priti Shah · Referred by a personal contact
Nick arrived at the consultation assuming the only question was which firm would handle the liquidation. He left understanding that liquidation had never been necessary. For Tanya, the relief was different — not just that the company was closed cleanly, but that a debt she hadn’t created could no longer be used as leverage in the divorce. Both of them left with something they hadn’t expected to find: a way out that was genuinely fair.
In a similar position?
If you’re a director facing pressure to liquidate — or you’ve been told it’s your only option — speak to us before you sign anything. The initial conversation is free and completely confidential.
The work behind the outcome
An insolvency practitioner has one primary tool. It is the one that generates a fee. When Nick came to us, he was hours away from signing an engagement letter with a firm that had not told him his appointment would trigger a personal demand for £30,000. They knew he was going through a divorce. They knew he was selling the family home and expected to realise approximately £60,000. The demand would have been made against those very funds. It was not a detail they would have missed.
We assessed the position from the beginning, as we always do — not from the assumption that formal insolvency was the only route, but from the question of what the correct route actually was.
The first thing we established was what the company genuinely owed. Total creditor exposure: £7,800. The liquidation Nick had been steered towards would have cost him the £30,000 DLA repayment — demanded by the appointed liquidator under their statutory powers — plus the IP’s fees on top. He would have paid more than five times the company’s actual debt to creditors. The most expensive route was also the one that helped his creditors least.
The second thing we established was whether dissolution remained available. Under voluntary strike-off provisions of the Companies Act 2006, a company can be removed from the Companies Register without entering formal insolvency, provided it has ceased trading and faces no pending legal proceedings or winding-up petition. Critically, no insolvency practitioner is appointed. Under the Insolvency Act 1986, the power to investigate and recover an overdrawn director’s loan account rests with an appointed liquidator. Where no liquidator is appointed, that power does not arise.
The company met the conditions. We confirmed it had ceased trading and faced no legal action. We then arranged for the creditors to be settled in full — £7,800 — and submitted the application to Companies House, following the correct statutory process prior to filing. The company was struck off the register and closed.
Tanya’s position as a director was also resolved cleanly through the strike-off. There was no investigation, no conduct report, and no personal liability attached to her involvement. There was something else too. Tanya had been quietly worried that the £30,000 DLA — Nick’s debt, not hers — might become a pressure point in the divorce; that he would use it to justify a larger claim against the proceeds of the house sale. With the DLA extinguished through dissolution, that pressure point was removed. The financial separation could proceed on its own terms.
The saving against the liquidation route: over £22,000. By paying creditors directly and applying to have the company struck off the Companies Register, Nick avoided a £30,000 DLA demand, settled all creditor obligations for £7,800, and closed the company without an insolvency practitioner, without investigation, and without the funds from his home sale being consumed by a process that was never necessary. The reason it was available: because we looked for the right answer, not the billable one.