Rent owed during administration must still be paid by the company

The high court have recently ruled that rent which falls due before a company goers into administration must still be paid and will not be classed as an administration expense. It was ruled that is should rank equally alongside the other unsecured creditors’ claims, even if the property is used by the administrators during the rent period. It was ruled that if rent falls due during an administration the administrator would have to pay the entire quarter’s rent even if the property was vacated after a few days.

Going into administration is bad enough without the aforementioned added worry. Don’t let things get that bad for your company, contact Beer & Young early on to discuss the options available to you, including investment from one of our business angels.