Close your company with a Creditors' Voluntary Liquidation

When you contact us, you will get our expert advice on the best way for you to deal with your particular situation. This advice is free.

We can discuss your options by phone, e-mail, Skype or face-to-face at a mutually convenient location – e.g. your Accountant’s office.

Where there is a better option than a CVL (e.g. a Company Voluntary Arrangement), we will tell you.

Once you instruct us, we will send you a Payment Request and a Letter of Engagement.

Before liquidation proceedings can commence the company needs to have ceased to trade and we must be in receipt of the following:

• Two forms of certified identity for each director and all shareholders who hold 25% or more shares in the company
• Completed History and Information Gathering Questionnaire
Completed Pension Questionnaire
• A full list of creditors, including name, address and amount outstanding
• A full list of employees who have been made redundant (if required, we can provide assistance with any redundancies)
• Copies of the last 3 years accounts, if applicable.

We will prepare all the documentation that is required for the CVL process, and we will liaise with any required external parties (e.g. RICS valuers for valuing any company assets).Dependant on the company’s Articles of Association, we are able to place the company into liquidation within approximately 7-14 days.Two Meetings are required to do this:

At the Board Meeting, the company directors formally resolve the company is insolvent and cannot continue to trade. At this meeting the directors would also agree to appoint Clarke Bell as the liquidator of the company, as well as agreeing for the necessary Meeting of Members to be summoned.

The Board Meeting is generally held at the director’s home or office. Prior to the meeting, we will email you all the documents that you need.

Our attendance at this meeting is not required, but we are at the end of a phone if you need any help.

The Members’ Meeting is normally held approximately 14 days after the Board Meeting. (It can be convened at short notice, should the statutory percentage of members agree to this.)

It is at this meeting that the company is formally placed into liquidation.

The Members’ Meeting will be held at our offices. The company directors are required to attend. Again, we will supply you with all the necessary documents required for this meeting.

The company’s Books and Records should be provided to us prior to this meeting.

This meeting normally lasts 15 minutes.

At the completion of the meeting, your company is now in formal voluntary liquidation.

While the company is in liquidation with a liquidator appointed once the Members’ Meeting has been held, the creditors still have to ratify the appointment of the liquidator. Due to the new Insolvency Rules, since April 2017 there is no longer a requirement to hold a Physical Meeting of Creditors to ratify the appointment of the liquidator. The appointment can now be deemed as accepted, unless sufficient creditors object to this. This is the “Deemed Consent Procedure”. Alternatively, a “Virtual Meeting of Creditors” can be held where the creditors attend by conference-call rather than in person. Our preferred approach though is to use the “Deemed Consent Procedure”.

We keep a register of any objections. As soon as 10% of creditors who would be entitled to vote at a meeting object, then the deemed consent process automatically terminates and we have to convene a physical meeting.

It is also possible for creditors to requisition a physical meeting, but in order for one to be summoned it must be explicitly requested by either:

• 10% of the total creditors (by value); or
• 10% of the total number of creditors; or
• 10 individual creditors.

This is known as the ‘10/10/10 threshold’.

Once this ‘10/10/10 threshold’ has been met, or if sufficient objections to the Deemed Consent Procedure are received, then within three days we will convene a physical meeting. We will notify the directors and they will be required to attend the meeting. While every effort will be made to ensure that it is held on the same day as the Members’ Meeting – for everyone’s convenience – that will not be possible if the request for a meeting or objections are received after the time of the Members’ Meeting. It is to reduce the chances of that happening that we hold the Member’s Meeting in the late afternoon, since creditors can object at any time prior to 23.59 hours that day.

In our experience, since the new Insolvency Rules were introduced, it is very rare that a Creditors’ Meeting is explicitly requested, although there are occasionally objections to the Deemed Consent Procedure.

When a company gets into cashflow difficulties, some directors (wrongly!) choose not to pay the taxes that are due to HMRC – e.g. Corporation Tax, PAYE, VAT and NIC. The company does, however, continue to pay other parties (such as their suppliers). These payments may be considered to be ‘preferential’ payments, but are certainly to the detriment of HMRC. In the event of insolvency, this could lead to a director’s disqualification. In fact, this is one of the most common reasons for considering whether someone is unfit to be a director. Under the rules of the Company Director Disqualification Act 1986 (CDDA) a director can be disqualified for between two and 15 years.

As part of our investigation will look into this and other matters relating to the conduct of the directors and the affairs of the company. We are required by law to submit information to The Insolvency Service about the conduct of all those who have been directors, or shadow directors, of the company within the 3 years prior to liquidation. We have 3 months from the date of liquidation to submit the information.