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Your rights when a business you dealt with goes into administration — Articles

When a business you have dealt with enters administration or liquidation under the Insolvency Act 1986, you become a creditor — either secured, preferential, or (most commonly) unsecured. Your consumer rights under the Consumer Rights Act 2015 still exist in theory, but the company may have no money to satisfy them. Knowing your practical remedies makes the difference between recovering your money and losing it entirely.

Section 75: your strongest protection if you paid by credit card

Under s.75 of the Consumer Credit Act 1974, if you paid any part of a purchase between £100 and £30,000 on a credit card, the card company is jointly and severally liable alongside the supplier for any misrepresentation or breach of contract — including non-delivery because the company has failed. You can claim the full amount from your card issuer without needing to prove anything against the company. Contact your card issuer as soon as you know the supplier has entered administration — do not wait for the administration to conclude. See the digital content rights article for how Section 75 applies to online purchases.

Chargeback for debit card and bank transfer payments

Chargeback is a voluntary scheme (not a statutory right) run by card networks. If you paid by debit card and the goods or services have not been delivered, contact your bank and ask for a chargeback within 120 days of the transaction. For bank transfers, there is no chargeback mechanism — you must register as an unsecured creditor in the administration. Use the Companies House search to find the administrator's details and submit a proof of debt.

Vouchers, gift cards, and loyalty points

Gift cards and vouchers are unsecured claims against the company. Unless the administrator honours them (which some do to keep customers during a business sale), they are typically worthless. Register as a creditor to preserve your claim, but unsecured creditors receive a return only if assets exceed secured and preferential creditor claims — which is rare in retail failures. The Citizens Advice guide on company insolvency sets out how to register as a creditor.

Deposits paid to tradespeople or service providers

If you paid a deposit to a builder, event company, or service provider that has gone into administration, you are again an unsecured creditor for that deposit. Section 75 may cover it if you paid partly by credit card and the total job value exceeds £100. For building work, check whether the trader was a member of a trade association with a deposit protection scheme — some schemes pay out when a member becomes insolvent. The FCA insolvency guidance covers financial services firms specifically. See the judgment glossary entry and the remedy entry for the wider context on enforcing your rights.

This article is for general information only and is not legal advice. Always check the official source and consult a qualified lawyer for your situation.

Section 75: your strongest protection if you paid by credit card

Chargeback for debit card and bank transfer payments

Vouchers, gift cards, and loyalty points

Deposits paid to tradespeople or service providers

Questions about this article