You've received a Section 345 demand. You have 21 days. Use them.
Short answer
A Section 345 demand is a formal legal step that — if ignored — deems your company unable to pay its debts and opens the door to a liquidation application. This is not a letter to file away. KLS helps you respond correctly and decisively.
Who this is for
Is your company facing any of these?
You've received a Section 345 demand letter
A creditor has served a formal demand at your registered office. You have 21 days to pay or secure the debt. Failure to do so creates a statutory presumption of insolvency.
A liquidation application has been filed against your company
The matter is already before court. You need legal representation to oppose the application or negotiate a resolution before the return date.
Your company cannot meet its debts as they fall due
Commercial insolvency — the inability to pay debts as they fall due — is the legal test for liquidation. If this describes your company, you need to act before creditors do.
The cost of waiting
What liquidation means for your business
Liquidation is not a restructuring — it is the end of the company as a trading entity.
Company wound up
A liquidation order means the company ceases to exist as a trading entity. A liquidator is appointed to realise assets and pay creditors in order of preference.
Directors lose control
Once a liquidation order is granted, directors lose all authority over the company. The liquidator takes over and directors must cooperate fully under penalty of law.
Employee consequences
All employees are effectively retrenched. While preferent claims exist for unpaid wages, recovery is not guaranteed and can take months.
Personal liability risk
If the liquidator finds evidence of reckless trading, fraudulent preference, or other breaches of directors' duties, directors can face personal liability for company debts.
How it works
How KLS helps you respond to liquidation risk
Immediate assessment
We review the demand or application, assess the company's financial position, and identify whether the debt is disputed, whether the demand is procedurally valid, and what response options exist within the timeframe.
Response strategy
Options include: paying or securing the debt, opposing the liquidation application on legal grounds, negotiating a settlement or payment arrangement with the creditor, or commencing business rescue proceedings to obtain a moratorium.
Execution and protection
We implement the chosen strategy immediately. Where business rescue is the right route, we manage the commencement process to ensure the moratorium attaches and creditor action is suspended.
Before you start
What KLS checks before opening the matter
The intake is designed to classify the legal route, identify the documents that matter, and flag whether the matter needs attorney review before a formal step is taken.
Start this assessmentAssessment route
Liquidation Risk Assessment
Review posture
Attorney review
Primary audience
Business
Legal context reviewed
Companies Act section 345, Liquidation proceedings
Last reviewed: 17 May 2026 · Next review due: 17 Nov 2026
Trust and intake boundaries
What you can expect at this stage
Document readiness
Useful documents to prepare
Routing checks
What the assessment helps KLS identify
This assessment is not legal advice and does not promise rescue, settlement, or opposition success. It helps KLS classify risk and readiness.
Guided pathways
If you are still deciding, use the pathway first
Related guides
Understand the issue before you submit
Connected legal routes
Other pages that may fit the same pressure
FAQs
Questions about liquidation risk
Get started
Get urgent liquidation risk advice
Tell us about the demand or application — the creditor, the amount, and the timeline. We respond within one business day, often the same day for urgent matters.
Start the secure intake
You will answer a short set of questions so KLS can route the matter into the correct review process.
Continue to intakeYour information is confidential and used only for intake and consultation purposes.
Priority outcome
You receive an urgency and routing outcome.
Document guidance
KLS identifies whether senior review is needed.
Next step routing
Document and payment gates control consultation access where needed.
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