HomeFWJ TakeawayResourcesWinding up petition minimum debt threshold

At present the threshold for issuing a winding up petition is £750. We can help you issue a petition on a competitive fixed fee basis. Call our team.

At present the threshold for issuing a winding up petition is £750.  There is no maximum amount but the minimum debt cannot be below £750. 

Does it make sense to chase low value debts using a winding up petition?

Some clients at Francis Wilks & Jones do ask us what is the point of issuing a winding up petition for such low value debts. Afterall, the court issue fee is currently £1,880. It is a good question but one which is easily answered by the example set out below.

Example – collecting a debt for £1,500 – how a petition can help

In this example, we are chasing a debt of £1,500 for a client.

Option 1 – chasing the debt through the small claims court

Let’s assume first that the client wants to proceed with the case in the traditional small claims court.

  • the fee for issuing the claim is £70 and solicitors fixed costs of £80. You may be lucky and the defendant fails to defend the case and you enter judgement against the defendant – at a further cost of £22;
  • you may be unlucky and the defendant defends the case all the way to trial.  Not only will this take 6-9 months on average, our analysis is that with the best will in the world, the legal costs of preparing dealing with the defendant, reviewing documents, sending letters, preparing witness statements and attending a hearing will be in the region of £2,000;
  • let’s assume you then win the small claims hearing.  You get awarded your £1,500 debt, fixed costs of £102 and court fee of £70. But you have spent over £2,000 getting the judgement.  More than the debt you were chasing;
  • and here’s the thing – in the small claims court (any claim of less than £10,000), you are not entitled to recover your legal costs from the losing party;
  • and what do you end up with at the end of either process? A Judgment.  That is a piece of paper stating that you are owed a certain amount of money by the debtor;
  •  and what do you do with that piece of paper – you then have to enforce that Judgment;
  •  and one way of doing that is by issuing a winding up petition.

Option 2 – going straight for a winding up petition

So why not cut out all the time and expense of the above process and go straight for a winding up petition?  That is what we recommend to our clients.  It saves time and money once you work out the cost of proceeding down the small claims court first. And even better – unlike the small claims court, in winding up proceedings you can recover your legal costs as well in cases under £10,000.

In over 50% of all cases we carry out, we recover the debt, late payment interest, late payment compensation and legal costs in full for our clients. This is effectively a net zero legal spend for those clients as the debtor is paying the legal costs as part of the settlement.

Even if the debt is not paid following a winding up petition, you do not have to wind the company up. But even in these circumstances, you have saved yourself the time and cost of proceeding in the small claims court first and secondly, of the initial £1,880 court fee paid, you will receive £1,550 back from the court, effectively meaning that the court fee for a Winding-Up Petition is only £330.


If you have a winding petition question we are the firm to help. We provide quick, cost effective and commercial advice. Call now us now to speak to one of our friendly advisers.

Case studies

View all case studies

Contact us in confidence