Stonham Barns Park hit with HMRC Winding Up Petition

A recent HMRC winding‑up petition (CR-2025-006418) against Stonham Barns Park underlines how quickly tax arrears can escalate into public insolvency proceedings, even where a company insists it can pay in full and continue trading as normal. For directors and stakeholders, the case is a useful reminder that HMRC uses winding‑up petitions as a last‑resort enforcement tool once other collection options have been exhausted, not simply as a routine credit‑control step.​

Background: HMRC petition against Stonham Barns

Public notices show that HMRC has presented a winding‑up petition in the High Court of Justice against Stonham Barns Limited, a company operating one of Suffolk’s largest holiday resorts and registered in East Sussex. The petition was listed in the Companies Winding Up Cause List and is presently adjourned to allow time for a settlement of the remaining tax balance, reportedly due by 21 January 2026.​

Although the precise petition debt has not been disclosed, recent filed accounts indicate material arrears of social security and other taxes running into several hundred thousand pounds over 2023–2024. The company’s directors have publicly stated that Stonham Barns is fully in funds to meet the obligation and that there is no risk to the ongoing operation of the resort and its on‑site businesses, describing the petition as part of a structured arrangement following a review of historic filings.​

What Is a Winding Up Petition?

A winding up petition is a formal application to the High Court by a creditor seeking to liquidate a company that owes £750 or more and is believed to be insolvent. If granted, it results in a winding up order, placing the company into compulsory liquidation, its assets are sold, debts paid where possible, and the company ceases to exist as a legal entity.

This is one of the most serious forms of debt recovery. To proceed, the creditor (the petitioner) must show that the debt is undisputed and over the statutory threshold. This is usually evidenced by a statutory demand that hasn’t been set aside or a court judgment in the creditor’s favour.

Understanding HMRC Winding-Up Petitions

When Does HMRC Issue a Winding-Up Petition?

HMRC only resorts to winding-up proceedings after exhausting other debt recovery options. Before presenting a petition, the Revenue typically attempts various collection methods including payment reminders, formal demands, Time to Pay arrangements, and enforcement action.

A winding-up petition represents the nuclear option in HMRC’s enforcement arsenal. It signals that the Revenue believes the company is unable to meet its tax obligations and that compulsory liquidation is necessary to protect the interests of all creditors.

HMRC can issue a winding-up petition if a company owes £750 or more in undisputed tax debt, including VAT, PAYE, Corporation Tax, or National Insurance contributions. The petition is typically served at the company’s registered office, either by process server or first-class post.

The Statutory Demand Stage

Before presenting a winding-up petition, HMRC usually serves a statutory demand giving the company 21 days to either pay the debt in full, make acceptable payment arrangements, or apply to set aside the demand. However, creditors including HMRC can proceed directly to petition without first serving a statutory demand, particularly where the debt is already established through previous court proceedings or tribunal decisions.

Critical Timeline After Service

Once a winding-up petition is served, companies face an urgent and unforgiving timetable that requires immediate legal action to avoid catastrophic consequences for the business.

Days 1-7: The Critical Window

The company has just seven business days from service to take decisive action before the petition is advertised in the London Gazette. This advertisement triggers a cascade of devastating consequences including immediate bank account freezes, loss of supplier credit, and reputational damage that can be fatal to trading relationships.

Advertisement in The Gazette

At least seven working days before the hearing date, the petitioner must advertise the petition in the London Gazette. This public notice alerts all creditors, banks, suppliers, employees, and customers to the company’s dire financial position. Banks routinely monitor Gazette advertisements and will freeze company accounts immediately upon discovering a petition, preventing the company from trading or paying wages.

Pre-Hearing Requirements

Any party intending to appear at the hearing must give notice of intention by 4:00pm on the day before the hearing. The petitioner must file form Comp 3 and a copy of the Gazette advertisement at least five working days before the hearing.

The Winding-Up Petition Hearing

At the hearing, the Court evaluates whether to grant a winding-up order, dismiss the petition, or adjourn the matter. The petitioner presents evidence of the debt and the company’s failure to pay, while the company’s legal representatives can dispute the debt, propose payment arrangements, or seek an adjournment to secure funding.

The Court has wide discretion but will only dismiss or adjourn a petition where there are substantial grounds to do so. Common grounds for challenging an HMRC petition include genuine dispute on substantial grounds, a valid set-off exceeding the petition debt, or procedural irregularities in the petition’s presentation.

If the Winding-Up Order is Made

A winding-up order has immediate and irreversible consequences:

• The Official Receiver becomes liquidator and takes control of all company assets
• Directors’ powers cease immediately
• All employees are automatically dismissed
• Any disposition of company property after petition presentation is void unless validated by Court order
• The liquidator investigates directors’ conduct for potential wrongful trading, preferences, or transactions at undervalue
• Directors face potential disqualification and personal liability

Defending Against HMRC Winding-Up Petitions

Companies served with HMRC petitions can defend on several grounds:

Genuine Dispute on Substantial Grounds: The tax assessment itself is disputed through a pending appeal or tribunal proceeding. The dispute must be genuine and substantial, not merely tactical or frivolous.

Set-Off Rights: The company has a valid cross-claim against HMRC that exceeds the petition debt. This might arise from overpaid taxes, pending refunds, or disputed assessments for other periods.

Procedural Defects: The petition fails to comply with technical requirements under the Insolvency Act 1986 or the Insolvency Rules, such as incorrect company details, improper service, or failure to conduct proper searches before presentation.

Company is Solvent: The company can demonstrate it has sufficient assets to pay all creditors in full and the petition debt represents a temporary cash flow issue rather than true insolvency.

Urgent Steps to Take Within 24 Hours of Service of Winding-Up Petition

Instruct specialist insolvency solicitors immediately. The seven-day window before Gazette advertisement requires urgent legal assessment and action. Specialist legal advice is essential to evaluate prospects of successfully defending the petition and preventing advertisement.

Seek Injunction to Restrain Advertisement

If there are valid grounds to challenge the petition, apply urgently to the Court for an injunction restraining HMRC from advertising the petition in the Gazette. This preserves the company’s banking facilities and prevents the reputational damage that flows from public advertisement.

Negotiate with HMRC

Even at this late stage, HMRC may agree to adjourn or withdraw the petition if the company can demonstrate a credible payment proposal or dispute. Representations from experienced solicitors carry far more weight than direct approaches from directors.

Apply for Validation Order

If the petition has already been presented, any disposition of company property is void under section 127 Insolvency Act 1986 unless validated by the Court. Companies must apply urgently for a validation order authorising essential transactions such as paying suppliers, wages, and receiving customer payments.

Why Companies Choose Our Team for HMRC Winding-Up Defence

Our team comprises of dual-qualified Solicitor-Advocates and Barristers, bringing decades of High Court and Companies Court advocacy experience to every HMRC winding-up petition case. This rare combination ensures clients receive both strategic solicitor advice and the highest level of court representation without instructing separate counsel, while benefiting from our team’s exclusive specialisation in insolvency and winding-up petition law. We have successfully defended hundreds of winding-up petitions, obtaining dismissals, adjournments, validation orders, and negotiated settlements that preserve businesses and jobs.

Our solicitors and barristers regularly negotiate with HMRC’s solicitors and appear before Companies Court judges, understanding exactly what arguments HMRC will advance and how to counter them effectively to achieve optimal outcomes. We provide same-day case assessments and can attend urgent court applications at short notice. When HMRC serves a petition, every hour counts, and our team is immediately available to provide strategic guidance on whether to defend, negotiate, or pursue alternative insolvency procedures.

What If Your Company Cannot Pay?

If your company genuinely cannot pay HMRC and has no realistic prospect of trading out of difficulty, fighting a winding-up petition may simply delay the inevitable while increasing costs and director liability exposure. In these circumstances, voluntary insolvency procedures offer better alternatives:

Company Voluntary Arrangement (CVA): A formal payment plan approved by creditors that allows the company to continue trading while paying debts over time. CVAs can include compromises where creditors accept less than 100p in the pound.

Administration: A court-protected procedure that provides breathing space to restructure the business or achieve a better realisation of assets than immediate liquidation.

Creditors’ Voluntary Liquidation (CVL): A director-controlled liquidation that avoids the investigation and potential director disqualification associated with compulsory liquidation.

Our insolvency specialists can advise on the optimal procedure for your specific circumstances, balancing creditor interests with director protection and business preservation where possible.

Expert London Winding up Petition Lawyers

We specialise in tax disputes, winding-up petitions, and civil litigation. If you or your business are facing issues similar to those encountered by the Salford Red Devils—whether it’s dealing with HMRC petitions, tax litigation against HMRC, or negotiation on your behalf—our experienced team is here to guide you through the complexities. We offer tailored advice to help protect your business and ensure compliance with legal requirements.

Contact Our Specialist Winding-Up Petition Solicitors

Our dual-qualified solicitor and barrister team provides same-day case assessments from our Middle Temple chambers in the heart of London’s legal district. We will quickly analyse your case prospects, advise on the merits of defending the petition, and implement urgent court applications where necessary to prevent advertisement and secure adjournments. Call +44 (0)207 183 0529 or complete our online enquiry form.  

Our insolvency team responds immediately to urgent winding-up petition enquiries. We understand the stress and uncertainty directors face when HMRC threatens their business with compulsory liquidation. Our job is to provide clear, strategic advice that achieves optimal legal and commercial outcomes.