# Supplier in liquidation or insolvency > A national register says the company is winding up or gone, while its VAT number still checks out. What each status means, and what to do before paying. Canonical: https://vetthisvendor.com/guide/supplier-in-liquidation Published: 2026-08-10. Updated: 2026-08-10. Author: Jose Pollman, VetThisVendor. A national business register reports that this supplier is in liquidation, insolvency, bankruptcy, judicial reorganisation, or has been struck off the register entirely. That is a statement about the **company**, not about the invoice, and it changes what paying means rather than telling you not to pay. ## Why the VAT number still looked fine This is the part that catches people out: **a company in liquidation usually keeps a VAT number that validates perfectly.** VIES answers "yes, registered" for companies that are being wound up, for companies in bankruptcy proceedings, and often for months after a company has stopped trading altogether. Deregistration is an administrative step that happens late, if at all. So a check that asks only "is this VAT number valid?" returns a clean green result for a business that no longer exists. That is precisely why this site reads the national company register as well, and why a finding there outranks the VAT answer instead of sitting quietly underneath it. ## The states are not the same thing They are reported with different words in each country, and the differences matter: **Liquidation / winding up.** The company is being closed and its assets distributed. This is not automatically a sign of failure — a *members' voluntary* liquidation closes a solvent company, and groups use it routinely to tidy up dormant subsidiaries. But a company in liquidation is being wound down, and new orders are not usually part of that. **Insolvency / bankruptcy.** A court proceeding is running because the company cannot pay its debts. An administrator, trustee or insolvency practitioner is typically appointed, and from that point **they** control the company's money — including who its customers should pay. **Judicial reorganisation / restructuring.** A rescue procedure. The company is under court protection and is usually still trading, often with the intention of surviving. This is the state where continuing to do business is most likely to be entirely normal. **Struck off / dissolved / terminated.** The company has been removed from the register. It no longer legally exists, which means it cannot legally issue an invoice or hold a bank account in that name. This is the most serious of the set. **Inactive (Romania).** A specific status with a specific consequence: a taxpayer declared inactive by ANAF may not legally issue invoices, and there are direct consequences for the deductibility of VAT and expenses on both sides of the transaction. Treat it as a stop sign rather than a caution. ## The fraud this result attracts Insolvency records are **public**. Anyone can read them, which includes people writing fraudulent emails. The script practically writes itself: > "As you may know, we have entered administration. Please direct payment of the > outstanding invoice to the administrator's account below." Everything in that message is plausible, the insolvency is real and verifiable, and the bank details are the attacker's. It is the strongest version of the invoice-redirection fraud because the unusual request comes with a genuine public explanation attached. What makes it dangerous is that the *legitimate* version looks identical. When a company really does enter insolvency, payment instructions genuinely do change, and a real practitioner really will write to ask you to pay a different account. You cannot separate the two by reading the email. **So do not act on new bank details that arrive with news of an insolvency.** Find the appointed practitioner in the court or register record — not from the email — and phone them on a number from that record. See [supplier asking to change bank details](/guide/supplier-changed-bank-details). ## What to do before you pay 1. **Read which state the result names.** Restructuring and dissolved are at opposite ends of the range. The card names the specific one the register used. 2. **Work out whether you are paying in advance or in arrears.** This is the question that decides your exposure. Paying *after* delivery is mostly an administrative problem. Paying *before* delivery makes you an unsecured creditor of an insolvent company, which is the position with the worst recoveries in every jurisdiction. 3. **Check who is entitled to receive it.** If a practitioner is appointed, get their details from the official record and confirm the account with them directly. 4. **Do not simply stop paying what you owe.** A debt for work already delivered is still owed, now to the estate rather than the company, and withholding it can leave you on the wrong end of a claim. Get the position in writing from the practitioner. 5. **Look at the invoice's VAT line.** A struck-off or inactive company issuing an invoice with VAT on it is a problem for your own deduction, not just theirs. Your accountant will want to see this before it is booked. 6. **Ask about delivery, not just payment.** Whether the company can still perform the contract is a separate question from whether it can be paid, and it is the one that usually matters more commercially. The specifics of who to pay, and what happens to a contract when the other side becomes insolvent, depend on the country and on your contract. Those are questions for your accountant or a lawyer — this page is about noticing the situation in time to ask them. ## When it is nothing to worry about - **A dormant group company** in a members' voluntary liquidation, while the trading company that actually sends your invoices is a different entity entirely. - **A restructuring the business survives.** Companies come out of these and go on trading for decades. - **Register lag.** Records are updated on the registry's schedule, and a concluded proceeding can sit visible for a while afterwards. Portugal is the clearest case: Citius publishes the whole lifecycle of a case including its closure, which is why a Portuguese result is shown as a prompt to look rather than as a finding of present insolvency. - **The wrong company.** Portuguese insolvency records name creditors as well as debtors, and being listed as a creditor means the opposite of being in trouble. This tool matches on the debtor only, but it is worth knowing the distinction exists when you read the register yourself. ## What the check does and does not prove It proves that the register held this status for the holder of this VAT number when it was last read. It does not prove the invoice in front of you came from that company, that the company cannot deliver, or that you should not pay. Those need the phone call that every result on this site asks for — and here, more than anywhere else, the number to call is one you already had, or one from the official record. Not the one on the invoice. Which registers report this, and for which countries, is listed on [coverage](/coverage). You can run the check on [the homepage](/).