Prohibited name checker (section 216)
Section 216 of the Insolvency Act 1986 stops anyone who was a director of a company in the 12 months before it went into insolvent liquidation from running, forming or managing another company, or an unincorporated business, under the same or a similar name for five years. Buying the business back is not banned; reusing the name is, unless one of three exceptions applies or the court gives permission. Breach is a criminal offence and makes you personally liable for the new company's debts.
Check whether section 216 applies to you
The date the winding-up resolution was passed, or the date of the court's winding-up order.
Optional: compare the names word by word
A guide to the statutory test, not a legal opinion. Whether a name is "so similar as to suggest an association" is for a court to decide, and the exceptions have strict conditions. Take advice before using any name you are unsure about. Dates use England, Wales and Scotland bank holidays from gov.uk, as a business day under the Insolvency Act excludes a bank holiday in any part of Great Britain.
Sources: Insolvency Act 1986 s216, s217, Insolvency (England and Wales) Rules 2016 Part 22, Insolvency Service: re-use of company names, gov.uk bank holidays, checked 23 September 2026.
The five questions that decide it
Section 216 only bites if every one of these is answered yes. If any is a clear no, the name restriction does not apply to you, although other rules on buying assets from an insolvent company still do.
| Question | What it means | Where it comes from |
|---|---|---|
| 1. Has the old company gone into insolvent liquidation? | A creditors' voluntary liquidation or a compulsory winding up where assets did not cover the debts and costs. It goes into liquidation on the day of the winding-up resolution or the court's winding-up order (s247(2)). | s216(1), (7) |
| 2. Were you a director in the 12 months before? | At any time in the 12 months ending with the day before liquidation, including as a shadow director or a director in all but title. | s216(1) |
| 3. Is the new name a prohibited name? | Any name the old company was known by in those 12 months (registered name or trading name), or one so similar as to suggest an association with it. | s216(2), (6) |
| 4. Are you involved in the way the section describes? | A director of the new company, concerned directly or indirectly in its promotion, formation or management, or in carrying on an unincorporated business under the name. | s216(3) |
| 5. Are you inside the five years? | The period of five years beginning with the day the old company went into liquidation. | s216(3) |
What counts as a prohibited name
The Insolvency Service gives these examples of names a former director cannot use for five years unless an exception applies or the court agrees. Trading names include registered trade marks and brand names, whoever owns them.
| Old company | New name | Position |
|---|---|---|
| ABC Limited, trading as XYZ, goes into insolvent liquidation | A company registered as ABC Limited or XYZ Limited | Prohibited |
| A company with any other registered name that trades, even partly, as ABC or XYZ | Prohibited | |
| A company or business with a name so similar to ABC or XYZ as to suggest an association | Prohibited | |
| A sole trader or partnership trading as ABC or XYZ | Prohibited | |
| John Smith Builders Limited goes into insolvent liquidation | John Smith trading under his own name | John Smith is a prohibited name unless an exception applies or the court gives permission; any legal duty to display the owner's name still applies |
The exceptions and their deadlines
| Route | Rule | Conditions | Timing |
|---|---|---|---|
| First excepted case: the business is bought from the office-holder | Rule 22.4 | The whole, or substantially the whole, of the business is acquired under arrangements made by the liquidator, or before liquidation by an administrator, administrative receiver or CVA supervisor. You must publish a notice in the Gazette and give it to every creditor whose name and address you know or could find with reasonable enquiries. | Before you act, and no later than 28 days after the arrangements complete. Not available if you have already acted in breach (r22.4(5)). |
| Second excepted case: prompt court application | Rule 22.6 | You apply to the court for permission within 7 business days of the liquidation date. You give the Secretary of State at least 14 days' notice of the application (r22.2). | You may act for up to six weeks from the liquidation date, or until the court decides if sooner. If there is no decision by then, the ban applies again. |
| Third excepted case: the name was already established | Rule 22.7 | The other company has been known by the name for the whole of the 12 months before the liquidation, and was not dormant at any time in those 12 months. | Applies to companies only, not sole traders or partnerships. |
| Court permission | s216(3), r22.2, r22.3 | Apply to a court with jurisdiction to wind up companies. The court may ask the liquidator to report on why the company failed and your part in it. | Any time in the five years. Not retrospective, so it does not cover anything done before it was granted. |
The Insolvency Service adds points on the first exception that catch people out: it is your job to give the notice, not the insolvency practitioner's; buying only the right to the name does not count, because the whole or substantially the whole of the business must be acquired; the sale has to be a firm arrangement, not a vague intention; and if the price is paid in instalments, the notice still has to go out before you use the name and within 28 days of completion. The Insolvency Service publishes a rule 22.4 notice template.
Worked example: the 7 business day deadline over Christmas
An illustrative case. The members of a company pass a resolution to wind it up voluntarily on Thursday, 17 December 2026, and it is insolvent. A director wants to keep trading under the old name while applying to court. Weekends and bank holidays in any part of Great Britain do not count as business days (Insolvency Act 1986, s251), so the window stretches:
| Step | Date |
|---|---|
| Liquidation date (winding-up resolution passed) | Thursday, 17 December 2026 |
| Days that do not count as business days in the window | Saturday, 19 December 2026; Sunday, 20 December 2026; Friday, 25 December 2026; Saturday, 26 December 2026; Sunday, 27 December 2026; Monday, 28 December 2026 |
| Last day to apply to court and get the rule 22.6 grace period | Wednesday, 30 December 2026 |
| Grace period ends (six weeks after liquidation), unless the court decides sooner | Thursday, 28 January 2027 |
| Last day of the five-year restriction | Tuesday, 16 December 2031 |
Miss the 7 business days and the director can still apply at any time within the five years, but must not act under the name until the court gives permission.
If the business is being bought back
Section 216 is about the name, not the purchase. Buying the business or its assets from a liquidator or administrator is lawful and common. The purchase is judged on other rules: the office-holder has to get a proper price, and in an administration a sale of all or a substantial part of the business to a connected person within 8 weeks of the company entering administration needs creditor approval or a report from an independent evaluator (Administration (Restrictions on Disposal etc. to Connected Persons) Regulations 2021, regulation 3). Our pre-pack administration page covers that route, and phoenix company finance rules covers funding a legal restart.
If the new business will use the old name, the buy-back and the name have to be lined up: the first exception only works where the whole, or substantially the whole, of the business is acquired under arrangements made by the office-holder, with the notice out before you trade under the name.
If you think you are already in breach
The Insolvency Service suggests urgent professional advice and lists the ways out: resign and stop acting as a director of the company using the name, stop being concerned in its formation or management, change the company or business name and every trading style that could be a prohibited name, or apply to the court for permission, which will not cover the period before it is granted. Changing the name means removing the old one everywhere the public sees it, including the website, email addresses, social media, stationery, signs and how staff answer the phone.
Liability for the new company's debts runs for the whole time you were involved in its management in breach (s217). For the wider picture of what happens to you as a director, see what happens to a director of a company in liquidation, phoenix companies and reusing a business name and director disqualification.
Scotland and Northern Ireland
Section 216 applies in England, Wales and Scotland. For a company wound up in Scotland the exceptions are in Part 12 of the Insolvency (Scotland) (Receivership and Winding up) Rules 2018, which the Insolvency Service describes as similar to the England and Wales rules but with different numbering. Northern Ireland has its own version of the restriction in Article 180 of the Insolvency (Northern Ireland) Order 1989, with permission from the High Court; this checker does not map the Northern Ireland exceptions.
Common questions
Can I use the same company name after liquidation?
If you were a director of the company at any time in the 12 months before it went into insolvent liquidation, generally not for five years, unless one of three exceptions in Part 22 of the Insolvency (England and Wales) Rules 2016 applies or the court gives permission. The ban covers the registered name, any trading name used in those 12 months, and any name so similar as to suggest an association.
Can I buy my business back from the liquidator?
Yes. Buying the business or its assets from the liquidator at a fair price is lawful, and section 216 does not stop it. What section 216 controls is the name. If you want to trade under the old name or a similar one, the first exception (rule 22.4) lets you do so where the whole, or substantially the whole, of the business is acquired under arrangements made by the office-holder and you gazette a notice and send it to every known creditor before you act, no later than 28 days after completion.
Does section 216 apply after a strike off or a solvent liquidation?
No, not on its own. Section 216 applies only where a company goes into insolvent liquidation, meaning its assets are not enough to pay its debts, other liabilities and the costs of the winding up. A company dissolved by strike off has not gone into liquidation, and a members' voluntary liquidation that really is solvent is not insolvent. If an apparently solvent liquidation turns out to be short, the rule can bite.
What happens if I breach section 216?
It is a criminal offence, punishable on conviction on indictment by up to two years in prison, a fine or both (Insolvency Act 1986, Schedule 10). Under section 217 you are also personally liable, jointly with the new company, for its debts incurred while you were involved in its management in breach. Anyone who knowingly acts on your instructions is liable too. The Insolvency Service adds that you could be disqualified as a director.
Does the ban apply if I was never formally appointed a director?
Yes, it can. Section 216 covers directors and shadow directors, and the Insolvency Service says it applies to anyone who acted as a director in the 12 months before liquidation, whether formally appointed or not.
Is it too late to ask the court for permission?
You can apply at any time in the five years. Applying within 7 business days of the liquidation gives you a grace period of up to six weeks in which you can act while the court decides (rule 22.6). Apply later and you must not use the name until permission is granted, because permission is not retrospective.
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