Liquidating your company is a big decision and is not something that should be done lightly. Before you decide to liquidate your company, you should speak to an experienced Licensed Insolvency Practitioner to make sure that you pick the best option for your situation.
There are a lot of Insolvency Practitioners who can help you with your liquidation, so you don’t need to be paying a huge fee. Also, thanks to technology and the insolvency rules, you can use an Insolvency Practitioner who is not based locally to you. This means that you can achieve cost savings by, for example, using a firm that’s not based in a relatively expensive area of the country.
The different types of liquidations
Solvent company liquidations
If your company is solvent, with assets worth more than £25,000 a Members’ Voluntary Liquidation (MVL) is going to be the most tax-efficient way to close your company. This is because the funds to be distributed are subject to Capital Gains Tax, rather than Income Tax. Additionally, when you qualify for Entrepreneurs’ Relief you can benefit from a 10% marginal rate on distributions.
This means that in an MVL the tax savings for the shareholders are significant; and it is a process that is approved and encouraged by HMRC.
The standard cost for an MVL with Clarke Bell is £995 +VAT, +disbursements.
This makes an MVL is very cost-effective way to close down a solvent limited company.
Insolvent company liquidations
If your limited company is insolvent and you are considering liquidating it, you’re best option is likely to be a Creditors’ Voluntary Liquidation (CVL). As a director you can propose a CVL if your company can’t pay its debts and the shareholders agree and pass a ‘winding-up resolution’.
The standard cost for a CVL with Clarke Bell is from £1,995 (all inclusive), with complex cases being charged on a case-by-case basis.
Do you want to liquidate your company?
If you want to liquidate your company – with an MVL or a CVL – you will have to appoint a Licensed Insolvency Practitioner.
At Clarke Bell, we will discuss your situation with you – that advice is free and confidential – and we’ll work out the best option for you.
Since we started trading more than 25 years ago, we’ve helped thousands of company owners with their liquidation process – from very simple cases to highly complex ones.
For your free initial advice, just contact us on 0161 907 4044/ [email protected]
