Insolvency Support for SMEs
What Help Is Available?
Insolvency Support for SMEs: What Help Is Available?
Running a business can be challenging, especially when cashflow pressures, rising costs, or late customer payments begin to mount. Many SME owners don’t realise that support is available long before insolvency becomes inevitable, and that early action can often save an otherwise viable business.
From free advisory services to HMRC payment plans and formal restructuring options, there are a range of solutions designed to protect jobs, stabilise finances and give businesses the breathing space they need. Below, we outline the key forms of insolvency support available to SMEs and the practical steps owners can take before it’s too late.
Many small businesses face cashflow pressures, late payments or rising costs and it’s not always clear where to turn for early support. Insolvency doesn’t have to mean the end of a business; in many cases, early intervention can prevent it altogether. Here are the main support options SMEs can access:
1. Business Advice & Early Warning Support
Before insolvency becomes a risk, SMEs can seek free or low-cost help from:
- Cheshire and Warrington Growth Hub, or other local Growth Hub if your business is not located in this region.
- Business support programmes and advisers
- Accountants or financial advisers
- Chambers of Commerce
These services can review your finances, cashflow and operations and help stabilise the business before issues escalate.
2. Time-to-Pay Arrangements (HMRC)
If tax arrears are causing pressure, HMRC may agree a Time-to-Pay plan allowing businesses to spread their payments over a manageable schedule. This can ease immediate cashflow problems without formal insolvency. Discuss this with your accountant who can recommend support by an Insolvency Practitioner.
3. Company Voluntary Arrangement (CVA)
A CVA allows a business to:
- Continue trading
- Reorganise debts
- Pay creditors over time
This can avoid liquidation and protect jobs while giving the company breathing space.
4. Administration
If a business is viable but struggling going into administration can:
- Protect the company from creditor action
- Enable restructuring
- Allow a sale of all or part of the business
- Administration is often used to save jobs and preserve business value.
5. Creditors’ Voluntary Liquidation (CVL)
If a business can’t realistically recover, a CVL offers:
- A controlled, director-led closure
- Proper handling of debts
- Protection for directors if handled correctly
It’s often a more responsible alternative to waiting for compulsory liquidation.
6. Debt Restructuring & Finance Options
Businesses can sometimes avoid insolvency through:
- Refinancing existing loans
- Short-term working capital
- Invoice finance or asset-based lending
- Negotiating directly with creditors
- Specialist advisers can help identify the most suitable route.
7. Director Support & Legal Guidance
Directors facing insolvency concerns can access advice on:
- Duties and responsibilities
- Avoiding wrongful trading
- Protecting personal liability
- Getting accurate guidance early is crucial.
Don’t wait, as early advice often saves viable businesses. Cashflow dips, rising costs or creditor pressure are common and support is available long before insolvency becomes unavoidable.