Initial company liquidation advice meeting (completely free)
Timeline: same day
This can be set up for the same day and, typically, takes place online or over the phone. Ideally, all of the board members should attend, which can be done via conference call, to go through the detailed process and implications of entering into members voluntary liquidation. If you choose to progress, terms of business will be sent across for you to review.
Finalise the company’s affairs
Timeline: usually 1-14 days
To keep the costs as low as possible, we generally recommend the directors finalise the company’s affairs before starting the members voluntary liquidation process. This will generally include:
- Raising any final invoices
- Selling any tangible assets which are not to be transferred in specie
- Paying any outstanding creditors
- Deregistering for VAT and PAYE and submit any final returns
- Preparing draft final accounts and corporation tax returns*
- Paying the estimated corporation tax balance
*These should only be in draft at this stage, as the final accounts and corporation tax return must be up to the date of liquidation.
Instruction and the declaration of solvency
Timeline: usually 1-3 days
Once you’ve finalised the company’s affairs, our terms should be agreed formally instructing us to liquidate the company. At this point, the agreed fee element should also be paid. There will be further costs we are required to pay to third parties within the members voluntary liquidation process. However, these will be paid once the company has entered members voluntary liquidation.
A declaration of solvency must be prepared, setting out the company’s remaining assets and liabilities, and confirming all debts can be paid within 12 months of the liquidation. This must be sworn before a solicitor or notary by all. Or, where there are 3 or more directors, the majority of the directors. As a health warning, if it emerges that the company is not solvent, a false declaration is a criminal offence.
Shareholders and directors meeting
Timeline: potentially same day
Depending on the number of shareholders, the meeting to place the company into members voluntary liquidation can be held almost straight away. If 90% of shareholders are actively engaged in the process, this is a possibility. Otherwise, 14 – 21 days notice must be given depending on the age of the company. Following this, the company can be placed into Liquidation.
Post liquidation and distribution
Timeline: 3 days to 6 months
Once the company is in members voluntary liquidation, any remaining assets can be realised and distributed firstly to any remaining creditors and then members. If all members provide an indemnity, an early distribution can be made while creditor claims are finalised. However, this is sometimes less practical where there is a significant number of shareholders.
Once all other issues have been dealt with and final clearance obtained from HM Revenue & Customs, the case can be closed and the company will be dissolved 3 months afterwards.
If you are looking to start the member’s voluntary liquidation process, feel free to contact one of our business rescue experts. The full MVL process costs from between £1,500 to £3,500 plus VAT and disbursements – contact us directly for a quote.