Selling company data when closing a company: who decides and when

This page explains the law in plain terms. It is not legal advice: take your own advice from a solicitor, accountant or insolvency practitioner before you act.

Can a company that is closing still license its records?

Yes, as long as the company has not been dissolved and the right person signs. Before any formal process starts, the directors decide; once a liquidator or administrator is appointed, they decide instead.

Buyers actively look for records from companies that are winding down:

• micro1 runs a Defunct Company Data Partnership for companies with 30 or more employees and English-language records²¹.
• Turing takes active, winding-down and wound-down companies, and warns that "chat and CRM history can disappear within weeks of shutting off"²³.
• Labelbox Prism says distressed and wound-down companies are "some of our most active sellers"²⁴.
• SourceX says companies "still operating, acquired, or wound down can all qualify"²⁵.
• Cognor Labs' closed-company programme and SimpleClosure AssetHub serve the US and startups^26,27.

Prices for small closures can be modest. One founder winding down a startup netted roughly USD 25,000 for his code and expected about USD 15,000 for workspace data²⁸. Our UK buyer comparison shows which programmes name the UK, and we ask each buyer to confirm in writing that it accepts UK companies before we introduce you. Our page for software companies covers code in detail.

Which closing route are you on, and who decides?

Your route depends on whether the company can pay its debts. That decides who has authority over the records and who benefits from a licence.

GOV.UK says striking off is "usually the cheapest way" to close a solvent company¹⁶. If you only want to pause, you can keep a company dormant, but only while it is not trading or "receiving income"¹⁶, so licence income would end dormancy for tax.

In 2025, 2,520 businesses with 20 to 249 employees entered insolvency in England and Wales, most through CVLs (our sum of the Insolvency Service's published bands)²⁹. Office-holders on those cases should read our insolvency practitioners page and office-holder guide.

What happens to records left in a dissolved company?

They stop being yours. On dissolution, "all property and rights whatsoever" of the company pass to the Crown as bona vacantia, or to the Duchy of Lancaster or the Duke of Cornwall in their areas¹.

Government guidance lists the assets this covers, including "copyrights", other intellectual property and "the benefit of other assets or agreements that the company entered into"¹⁹. GOV.UK adds that anything left goes to the Crown, including "any payments your company may receive in future"¹⁸. So a licence fee that arrives after dissolution is not the shareholders' money.

The Crown "does not have to deal with it in any particular way", and the Treasury Solicitor will not "correct mistakes or negligence"¹⁹. Former directors, shareholders and creditors, among others, can usually apply to court to restore the company within six years of dissolution^6,37. If the Crown has sold an asset in the meantime, you get the proceeds less costs, not the asset¹⁹.

The practical rule: license the records, receive the payment and distribute it before you apply to strike off.

If the company is insolvent or close to it, what must directors watch?

Once insolvency is likely, the directors' duty shifts towards creditors, so a quick sale of the records on the way out can be challenged later. In most cases the safer course is to take insolvency advice first.

• The creditor duty. In Sequana, the Supreme Court held that directors must consider creditors' interests when they know, or ought to know, that the company is insolvent or "bordering on insolvency", or that an insolvent liquidation or administration is probable. "The greater the company's financial difficulties, the more the directors should prioritise the interests of creditors"¹⁵. GOV.UK puts it simply: creditors' interests "legally come before those of the directors or shareholders"¹⁶.
• Transactions at an undervalue. A liquidator or administrator can ask the court to reverse a deal for consideration "significantly less" than what the company gave⁹. The look-back period is two years before the onset of insolvency¹⁰. A licence sold cheaply in a hurry is exactly this risk.
• Wrongful trading. A director who knew, or ought to have concluded, that insolvent liquidation or administration could not be avoided must take "every step with a view to minimising the potential loss to the company's creditors"⁸.
• No strike-off shortcut. A company cannot apply to be struck off while it is in administration or liquidation, or while a winding-up petition is pending⁴, and every creditor must get a copy of a strike-off application within seven days⁵.

If you are in this position, speak to an insolvency practitioner before you speak to any buyer. Once appointed, a liquidator can sell company property by private contract¹³ and an administrator has a matching power¹⁴, with the proceeds going to the estate.

Which records must you keep anyway?

Licensing gives a buyer a copy of your records; it does not discharge your duty to keep the originals. Plan the export so the company, or its liquidator, still holds what the law requires.

Keeping the insurance records matters because a company can be restored at any time for a personal injury claim⁶. If a buyer wants exclusivity, make sure the licence still lets you keep and use the originals for legal and tax purposes.

Does licensing fit your closing timetable?

Usually, if you start early. Buyers' published timings suggest one to three months from first conversation to payment, and longer if the buyer reviews the data before paying.

Published timings vary: Mercor pays "typically" 2 to 4 weeks after signing³¹; micro1 takes up to 30 days to approve data, then pays within 30 days of invoice²²; Mode "generally expects about three months" from first conversation to payment³⁰; Turing says records usually earn "within the first 2 months of scoping"²³.

Two clocks can cut that short.

1. The strike-off window. A company must not apply to be struck off if, in the previous three months, it has traded, made certain disposals for value, or done anything except what is "necessary or expedient" for concluding its affairs or making the application³. Making the application in breach is an offence³. The Act does not say whether licensing records counts as concluding the company's affairs³, so take legal advice and, where you can, complete the licence and receive the payment before that three-month period begins. After you apply, the registrar publishes a notice in the Gazette and can strike the company off two months later, at which point it is dissolved².
2. The subscription clock. Google says that after you cancel Google Workspace, users' data "will be deleted and can't be restored"³². Slack can downgrade a workspace to its free plan once fees are 28 days overdue³³, and the free plan permanently deletes content more than a year old³⁴.

A workable order of steps:

1. Choose your route with your accountant or an insolvency practitioner.
2. Keep paid subscriptions and one admin login per system until exports are done.
3. Get a free valuation to see whether licensing is worth doing.
4. Compare buyers and agree terms, with your own solicitor approving the licence. If a buyer will remove personal data after transfer, we tell you in writing first and your solicitor confirms the transfer route. See how it works.
5. Deliver, get paid and distribute before you apply to strike off, or hand over to the liquidator.

How should you tell staff and customers before you close?

Tell them before their records are licensed, explain what will be removed, and say who the buyer is. It is a legal duty as well as good practice.

When a company plans to use personal data for a new purpose, UK GDPR requires it to tell people "prior to that further processing"³⁵. The ICO's data sharing code says that on insolvency data might be "sold as an asset", and that you should "consider when and how you will inform data subjects"³⁶.

Closing is a sensitive moment. Reporting on US wind-downs found that proceeds "typically flow to senior creditors and investors", not employees, and Spirit Airlines' flight attendants' union objected to that sale on privacy grounds²⁸; as of 12 November 2026 the Spirit sale still awaits court approval, with a hearing set for 17 November 2026³⁸. Leave out HR files and health information, remove personal data to a published standard, preferably before anything leaves your systems (see our anonymisation standard), and explain what you are doing in plain words. Our guide to Slack, Teams and email archives covers staff messages, and our UK law guide sets out the wider rules.

If you are an adviser handling a client's closure, see our page for accountants and advisers. Sellers pay us nothing: the buyer pays our fee, and we disclose it in writing before you sign. See how we are paid.

Closing soon? Book a 30-minute call this week, before subscriptions lapse. We reply within one working day.