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Tax benefits available to you with an MVL

There are different ways to close down a solvent company.

Depending upon how much cash there is in your company, using a Members’ Voluntary Liquidation (MVL) could be the most tax-efficient way and save you thousands of pounds. By using an MVL the funds to be distributed are subject to Capital Gains Tax, rather than Income Tax.

If you qualify for Entrepreneur’s Relief (ER) you can benefit from a 10% marginal rate on distributions. This means there can be considerable tax savings for the director(s) of the company.

We aim to distribute the assets of the company after 35 days from the date of Liquidation.

Our standard cost for a Members’ Voluntary Liquidation is £995 +VAT, +disbs (see below for the disbursements).

We have a wealth of experience in MVLs:

Total number of MVLs:
2
,
1
6
6
Total cash distributed (£):
3
4
8
,
4
0
4
,
0
8
8

How much does an MVL cost?

We have a range of categories for our Members’ Voluntary Liquidation service. This means that we can help you close down your solvent company with an MVL, whatever your situation is.

Our prices are affordable, and we make the distributions to shareholders quickly.

To make things as clear as possible for you, we have categorised our MVL service options.

Each category assumes that the company has 1 or 2 shareholders.

If your company does have more than 2 shareholders, we can still help you – for £50 +VAT per additional shareholder.

Our MVL options...

Basic MVL

Company’s assets are:

  • • Cash at Bank only.

Our fee is £995 +VAT +disbursements

Standard MVL

Company’s assets are:

  • • Overdrawn Director's Loan Account (ODLA) only, or
  • • Cash at Bank and an ODLA

Our fee is £1,495 +VAT +disbursements

Complex MVL

Company’s assets are:

  • • Overdrawn Director's Loan Account (ODLA) and Cash at bank and
  • • Crown refunds to be recovered (e.g. Corporation Tax, s455)

Our fee is £1,995 +VAT +disbursements

Bespoke MVL

Company’s assets are:

  • • Complex assets
  • • Multiple creditors
  • • Numerous shareholders
  • • Pension scheme

Fee determined on a case-by-case basis

The Relevant Disbursements

There are some disbursements that have to be paid in a Members’ Voluntary Liquidation.

Clarke Bell charge all of these at cost, and we regularly review them to ensure we are getting the best prices available.

Statutory Adverts

These are to provide any possible creditors the chance to come forward to lodge their claim.

Throughout the course of the MVL we have to take out 3 Statutory Adverts in the London Gazette.

The cost of these is (3 x £78.00 = £234.00 +VAT): £280.80

Statutory Bond

A compulsory bond needs to be taken out. This provides the directors with security whilst funds are under the control of Clarke Bell. The bond fee is dependent on the assets of the company. (The typical bond fee is between £80 – £240.)

Important information...

The distribution to shareholders

We distribute 100% of the funds after 35 days from the date of liquidation.

In cases where a client has withdrawn the funds prior to our appointment – thus creating an Overdrawn Director’s Loan Account (ODLA) – this would be distributed ‘in specie’ after 35 days.

This has the advantage of the funds being kept in the control of the clients, which is a preferable option for some of our clients.

Additional fees will be charged if the company’s assets include:

  • a property which needs to be distributed in specie. Solicitors will need to be appointed.
  • a Deed of Assignment (e.g. for Premium Bonds or Fixed-Term Savings Accounts). Solicitors will need to be appointed.
  • a pension. Trustees will need to be appointed. The cost of this will depend on the number of members in the pension scheme.

If your company has any of these assets or any not listed above, just contact us and we will let you know the additional costs.

Section 110 demerger

For clients who are looking to demerge a business using Section 110 of the Insolvency Act 1986, our fee is £1,995 +VAT +disbursements

For more information about a s110 demerger, click here.

FAQs

What are the disbursements in an MVL?

Some legal disbursements have to be paid as part of the MVL process, and we regularly review them to ensure the best prices. They include; statutory adverts to give creditors a chance to come forward and lodge claims and a compulsory bond that provides directors with security.

Click here for more information.

Do I qualify for Business Asset Disposal Relief / Entrepreneurs’ Relief ?

Business Asset Disposal Relief / Entrepreneurs’ Relief offers a reduced tax rate of 10% rather than the 18% (for basic rate income tax payers) or 28% (for higher rate payers). To qualify for this you must be an individual not a company, work as an officer or employee of that company, own at least 5% of the company and have at least 5% of the voting rights.

Click here for more information.

When is the best time to do an MVL?

You may decide to close down your solvent company for a variety of reasons. The main ones are usually due to retirement, moving into full-time employment, or because you’re re-organising a group of companies. We can work with you to determine if an MVL is the best option, and discuss the precise timing to start the process.

Click here for more information.

What are the tax benefits of an MVL?

Using an MVL will mean that any funds can be distributed as capital, thereby reducing the tax burden. This can result in considerable tax advantages for you as the director of your company. If applicable, it allows you to close down your solvent company and take out your money in the most efficient and cost-effective way. An MVL is an HMRC-approved process.

Click here for more information.

Why might contractors consider an MVL?

As a contractor, there will be many reasons why you might decide to close down your company using an MVL process. You may be preparing for retirement, taking on an employee-role or emigrating. Regardless, the crux is that you no longer need your (solvent) company, and therefore want the most tax-effective and HMRC-approved way to extract the assets.

Click here for more information.

What happens during a Members’ Voluntary Liquidation?

The MVL process is quite straightforward and involves your accountant making the relevant tax calculations to see whether an MVL is the best option for you. If it is, we will aim to distribute company assets after 35 days from the date of liquidation. Also, there is no need for a face-to-face meeting.

Click here for more information.

What is the difference between an MVL and a CVL?
  • A Members’ Voluntary Liquidation (MVL) is a tax-efficient way for you to close down your solvent company. With Clarke Bell MVLs cost from just £995 +VAT + disbursements. (Very complicated ones cost a bit more).
  • A Creditors’ Voluntary Liquidation (CVL) is used when your insolvent company needs to be liquidated, and you care about your future business reputation. The cost of a CVL is from just £1,995 (+VAT + disbs).

Click here for more information.

How much does a Members’ Voluntary Liquidation cost?

Our standard cost for a Members’ Voluntary Liquidation is from £995 + VAT + disbursements; and we aim to distribute your company’s assets after 35 days from the date of Liquidation. Getting a quote with us is easy, just contact our team on 0161 907 4044 or [email protected].

Click here for more information, and find our how our MVL service compares to other UK providers.

Can I reclaim the VAT in an MVL?

Our low cost MVL service comes at a very affordable fee – from just £995 (+VAT + disbursements), and if your company pays our fee and is VAT-registered, it can claim back the VAT.

Click here for more information.

Will my money be safe during the MVL process?

The company bank account will be closed and funds forwarded to us for the Liquidation’s estate. Funds are held in a client-specific, interest-bearing account with Barclays and distributions to shareholders are transferred to the shareholders’ bank accounts. A compulsory bond also needs to be taken out, which provides directors/shareholders with security while the funds are under the control of Clarke Bell.

Click here for more information.

When will shareholders get the money?

Clarke Bell always aims to distribute the assets of the company after 35 days from the date of Liquidation. Getting a quote with us is easy, just contact our team on 0161 907 4044 or [email protected].

Why Choose Us

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Low cost

From £995 +VAT +disbs (at cost)
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Tax advantages

For company shareholders
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Quick payment

Usually received after 35 days
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Credit ratings

Not affected
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Insolvency Practitioner

Must be used (even though your company is solvent)
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HMRC-approved

Is a legitimate and tax-effective way to wind up a solvent company
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Nationwide

No need for face to face meetings
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Friendly

Professional Services

I am very impressed with the professional and efficient approach adopted by Clarke Bell.

Our MVL was handled in a timely manner and I was kept informed of progress throughout.

This is an excellent service which is also very good value for money – I am pleased to recommend Clarke Bell without reservation.

Clarke Bell provided a fast, friendly, professional, efficient and low cost service when we decided it was time to end the life of our company via the MVL route.

The documentation supplied was clear, any questions were answered immediately and there were no hidden costs.

I have absolutely no hesitation in recommending Clarke Bell to any other company director wishing to end the life of their company via the MVL route.

I just wanted to say how impressed I have been with every aspect of the MVL process.

It has been an absolute pleasure to work with your very professional company.

I will have no hesitation in recommending Clarke Bell Limited to any other potential clients.

Wishing you every success for the future.

Dear Mr. Bell, your firm has just completed the liquidation of the above company.

I would like to record the excellent service given by your staff, and the professional and timely manner in which they conducted the liquidation.

I will certainly use the services of your firm for any future liquidations of my clients and would recommend your firm to others needing such services.

Our MVL was handled in a timely manner and I was kept informed of progress throughout.

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