Understand the position
Clear information before you decide what to do next
Construction company insolvency advice covering contracts, retentions, CIS, VAT, subcontractors, plant, disputes and rescue or liquidation.
- Review cash flow contract by contract
- Reconcile applications, retentions and disputes
- Map plant, finance and subcontractor exposure
Contract value does not equal available cash
Applications, certifications, retentions, variations, defects and set off claims can create a large gap between reported revenue and money actually available. Each material contract should be reconciled.
Subcontractor and tax positions move quickly
CIS, VAT, PAYE, wages, merchant accounts and subcontractor balances should be updated alongside the cash forecast. Missing returns or disputed balances can obscure the true position.
Assets and live projects need protection
Plant ownership, hire agreements, materials on site, bonds, guarantees and contract termination rights may affect the available route. Advice should be taken before moving assets, contracts or staff.
Practical next steps
What to prepare now
A clearer picture helps the first conversation focus on realistic options.
- Prepare a contract by contract cash schedule
- List retentions, variations and disputed sums
- Reconcile CIS, VAT, payroll and subcontractors
- Gather plant finance and guarantee documents
Common questions
Construction Company Insolvency Advice FAQs
Can unpaid retentions be collected after liquidation?
They may remain company assets, subject to contract terms, defects, set off and the cost of collection. The liquidator will assess recoverability.
What happens to live construction contracts?
The outcome depends on the procedure and contract terms. Termination, step in and insolvency clauses should be reviewed promptly.
Can plant be moved to a new company?
Not without confirming ownership, finance terms, valuation and proper authority. Transfers at an undervalue can be challenged.
How are subcontractors treated?
They may be creditors for unpaid sums, although contractual rights, set off and ownership claims can alter the position.
Can a construction business use a CVA?
Potentially, where the underlying business is viable, funding is available and creditors are likely to support a realistic proposal.
What happens to CIS and VAT arrears?
They form part of the HMRC position and should be reconciled with all outstanding returns. Any proposal must also address ongoing compliance.
Can disputed applications be counted as assets?
They should be assessed realistically. Certification, contractual notices, counterclaims, legal costs and collection time all affect value.
When should construction directors seek advice?
Warning signs include missed payroll, reliance on disputed applications, persistent tax arrears, merchant restrictions and using new project cash to complete old work.
This page provides general information and is not legal, tax or financial advice. The right action depends on the company’s circumstances. Formal insolvency procedures must be handled by an appropriately authorised professional.
