Insolvency Solutions

Full guide

Phoenix restart: the plain-English guide

Phoenix is a word people use nervously. Done properly and openly it is a recognised way for a viable business to survive the failure of its company. Done badly it creates personal liability.

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Short answer

A phoenix restart is where a viable trade continues through a new company after the old, insolvent company is liquidated. It is legitimate when the new company buys the assets it needs from the liquidator at a proper value, the statutory rules on re-using the old name are followed, and nothing is hidden from creditors. It is not a way to walk away from debt.

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Is this right for you?

  • The trade is viable but the company is not.
  • You are prepared to buy the assets you need at a proper value.
  • You want the old company closed correctly, not abandoned.
  • You want the rules explained before you do anything.

What it means for you personally

  • Connected-party sales are scrutinised. Transparency and a proper valuation are your protection.
  • The prohibited-name rules carry personal liability and, in some cases, criminal sanction. They are not optional.
  • Personal guarantees given for the old company remain yours.
  • A restart that is planned openly with a licensed insolvency practitioner looks nothing like one that is not.

How it works, step by step

  1. 1

    Test whether the trade is viable

    Without the old debt, does the business make money? If the answer is no, a new company only repeats the problem.

  2. 2

    Identify what the new company needs

    Equipment, stock, work in progress, goodwill, contracts, people, premises.

  3. 3

    Value the assets independently

    The liquidator sells at a proper value. A connected-party sale gets looked at closely, which is exactly why the valuation matters.

  4. 4

    Deal with the name

    Re-using a prohibited name without following the statutory route can make a director personally liable for the new company's debts. This is decided before the new company trades.

  5. 5

    Liquidate the old company properly

    Mark Bassford, FCA, Licensed Insolvency Practitioner, is appointed and reports to creditors on what was sold and for how much.

Who does what

  • Michael O'Connor plans the restart with you and remains your point of contact.
  • Mark Bassford, FCA, Licensed Insolvency Practitioner, handles the liquidation and any sale of assets to the new company.
  • Tony Sampson, MIPA, FABRP, advises on the name rules, contracts and documentation.

Fees and what they cover

  • The first conversation is free and confidential.
  • Valuation and legal costs depend on the assets involved and are agreed in advance.

Common questions

Is a phoenix company legal?

Yes, when it is done properly: assets bought from the liquidator at a proper value, the name rules followed, and full disclosure to creditors. What is not legal is stripping assets out of the old company or misleading creditors.

Can the new company have the same name?

Only by following the statutory exceptions to the prohibited-name rules, which include specific notice requirements and time limits. Get this wrong and the director can be personally liable for the new company's debts.

Who decides what the assets are worth?

The liquidator, on independent valuation advice. As a connected buyer you want that valuation to be robust, because it is the evidence that the sale was proper.

What will creditors be told?

The liquidator reports the sale to creditors, including that the buyer was connected. That transparency is part of what makes the restart defensible.

Can I use the old company's website, vehicles and equipment?

Only if the new company acquires them properly from the liquidator. Simply continuing to use them is one of the most common mistakes.

How soon can the new company start trading?

That is part of the plan, and depends on the assets, the name position and the liquidation timetable.

Michael O'Connor

Reviewed by Michael O'Connor, M.A. (Cantab), MABRP

Director and lead adviser. Last reviewed September 2026.

The other options

Defend your companyStop hostile creditor or HMRC action and stabilise the company.See how this works Close your company safelyA trouble-free Creditors' Voluntary Liquidation, with you in control of the timing.See how this works Continue your businessKeep trading through a new company while the old one is closed properly.See how this works Protect yourself as a directorPersonal guarantees, loan accounts, wrongful trading and disqualification risk.See how this works

Talk it through before you decide anything.

Free, confidential and informal. Michael replies personally, usually the same day.

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Clear options for directors under pressure. One adviser, from the first call to the finish.

Ask Michael a question

Free, confidential and informal. No obligation.

Optional. A sentence is plenty.

Confidential. Your details are used only to reply to you and are never sold or shared. No insolvency process is triggered by contacting us.

This page is general information, not legal or financial advice.

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