Voluntary Liquidation Vs Compulsory Liquidation (court process)
The first and main benefit of voluntary liquidation is that it gives you time to talk with your insolvency practice of choice. You can take advice and firm up answers to some of the issues that may be on your mind.
We’ve listed below a few of the most common concerns or problems that directors face at this time, which are often much better dealt with in a well organised voluntary liquidation:
- Personal Guarantees: when the company goes into liquidation, any personal guarantees you have given will ‘crystallise’ or become payable; ideally you need a preemptive plan in place to deal with this.
- Director’s redundancy claims: if you have been on the company’s payroll, you may be entitled to make a claim for directors’ redundancy. This could be crucial income at a time that you most need it.
- Director’s loan accounts: the liquidator will look to recover any funds owing from an overdrawn director’s loan account.
- Director’s conduct advice: the liquidators’ investigation into your conduct as company director is a mandatory aspect of liquidation.
- Redundancy process or transfer of existing staff to a new business.
- Sale of assets
- Transfer of leases
As voluntary liquidation is a paid service that we provide, you won’t be too surprised when we say it is normally a better option! However, in terms of making you better prepared and able to cope with what liquidation will throw at you, voluntary liquidation is a much more controlled solution.
It also gives you chance to find out any other information or options that you might not be aware of. This means that you can plan for what liquidation will entail, rather than having the choices of the Official Receiver forced upon you.
When a company is wound up by HMRC or anyone else, once the Official Receiver is officially appointed, the liquidation process begins. However, even if a petition has been issued, you can still apply for voluntary liquidation at any time prior to the court hearing date.
If you are worried about the costs of voluntary liquidation, try our liquidation fee calculator to get a quote for what voluntary liquidation might cost you.
Alternatively, if you would like to talk this through with one of our business rescue experts, use our booking system to arrange a meeting or contact one of our business rescue experts directly.
Voluntary Liquidation Quote
How much will it cost to liquidate your business?
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Liquidation is likely to crystallise any outstanding personal guarantees, so you will need to consider carefully how to deal with these prior to liquidating. There are options available that we are happy to discuss, but it is important to understand the potential effects of the guarantees prior to liquidating.
We can organise attendance at your premises to assist with staff redundancies. There is an added charge of £350 for this (already included in your quote). We find that it can really help staff move their claims forwards, and understand the procedure better. Where possible, we work with the local Job Centre so that exiting staff are aware of training opportunities and the most efficient ways of making benefit claims.
Buying assets from the liquidator
Please contact our office or book an appointment if you want to buy assets back from the liquidator. Once we have details of your assets, we can organise independent valuers to review (either on paper or by site visit, depending on the asset types), and we can then agree a fair figure for the purchase.
It may be possible to pay for the assets over a period of time, though it is likely that security would be required.