You may be able to reuse your company name after liquidation but only in limited circumstances. This is because UK insolvency law places restrictions on directors reusing the same or a similar name after an insolvent liquidation.
These restrictions are in place to protect creditors and avoid confusion where a failed company appears to continue trading as if nothing has changed. Whether you can reuse it or not depends on how the new business is set up and what steps are taken at the point of liquidation.
Why company name reuse is restricted
When a company goes into insolvent liquidation, creditors often receive little or no repayment. If a new company begins trading under the same or a very similar name, it can suggest that there’s been ‘foul play’ and undermine confidence in the insolvency process.
For that reason, directors of insolvent companies are restricted from reusing names connected to the failed business unless specific conditions are met. These rules are overseen by the Insolvency Service and are set out in insolvency legislation.
The restriction is about transparency and fairness, rather than preventing directors from starting again.
When the restriction applies
The restriction applies if:
- The company has entered insolvent liquidation
- You were a director or shadow director at any time in the 12 months before liquidation
- You want to use the same or a similar company or trading name
- The new business carries on the same or a similar type of business
Where all of these apply, the name cannot be used for five years from the date of liquidation unless a statutory exception applies.
The restriction covers:
- Registered company names
- Trading names
- Business names that are so similar they suggest a connection with the old company
And it applies whether the name is used formally or informally.
What counts as the same or a similar name?
A name does not need to be identical to be caught by the restriction. The test is whether the name would lead a reasonable person to believe there is an association with the liquidated company. This can include:
- Minor wording changes
- Adding dates, locations or generic terms
- Keeping the same trading name while changing the registered company name
When Can A company name be reused?
There are specific situations where reuse is allowed. These need to be handled carefully and in the correct order.
1. Buying the business from the liquidator
If the business or its assets are purchased directly from the liquidator, including goodwill, reuse of the name may be permitted. This usually involves:
- A formal sale process
- Proper valuation of assets
- Clear documentation
There are also notice and timing requirements that must be followed. This is the most common route where directors want to continue trading under the same brand.
2. Court permission
Directors can apply to court for permission to reuse the name. This application usually needs to be made within seven days of liquidation and before the name is used. The court considers factors such as:
- Director conduct
- Impact on creditors
- Risk of confusion
This route is less commonly used and involves additional cost and uncertainty.
3. An existing, established business
In limited cases, reuse is allowed where an established business has already been trading under the name for at least 12 months before liquidation and continues to trade. This is situation-specific and relatively uncommon.
What happens if the rules aren’t followed?
Using a restricted name without permission can create personal exposure for directors. Consequences can include:
- Personal liability for the new company’s debts
- Director disqualification
- Criminal penalties
These risks apply even where the new business is otherwise run properly. The issue is the name itself.
Does liquidation stop you from starting again?
Liquidation itself doesn’t usually prevent you from forming or running another company. For most directors, the ability to start again depends on the outcome of the liquidator’s review of their conduct.
As part of every insolvent liquidation, the liquidator needs to submit a confidential director conduct report to the Insolvency Service. This report looks at how the company was managed once insolvency became likely and whether directors met their legal duties to creditors.
Where the liquidator finds no evidence of misconduct, the report usually closes with no further action taken. In these cases, directors are free to act as directors in new companies.
Key takeaways
- Company name reuse after insolvent liquidation is restricted by law
- Similar names can still fall within the rules
- Reuse is possible in specific, structured situations
- Ignoring the rules can create personal liability
- Liquidation itself doesn’t usually stop you from starting again
Get advice on reusing a company name
If you’re thinking about starting again after liquidation, it’s worth getting clarity before you choose a company name or begin trading. The rules around reuse are strict, and timing and structure matter more than many directors realise.
A short conversation with a qualified insolvency practitioner can confirm whether reuse is possible in your case, what needs to happen for it to be done properly and whether a clean break would give you more certainty. It also allows any director conduct issues to be addressed early, before they create avoidable complications.
Speak to our experts about your liquidation or reusing a company name and get free, confidential advice today.
