Expert Company LiquidatorsServing Carshalton Beeches

A company liquidator is a licensed insolvency practitioner who manages the winding down of a company. Their role includes realising assets, settling creditor claims, investigating the company's affairs, and ensuring that all legal requirements are met. They act in the interests of creditors while also advising directors on their duties and potential liabilities.

The cost of liquidation varies depending on the complexity of the company's affairs, the number of creditors, and the value of assets. Typically, fees are based on time spent or a fixed fee agreed upfront. It is important to obtain a clear quote from a licensed practitioner before proceeding, as additional costs may arise.

A company's directors can appoint a liquidator through a members' voluntary liquidation if the company is solvent. For insolvent companies, creditors or the court may appoint a liquidator. In some cases, directors can initiate a creditors' voluntary liquidation, but the appointment must be approved by shareholders and creditors.

The process begins with a formal meeting of shareholders to pass a resolution for winding up. A licensed insolvency practitioner is then appointed as liquidator. They take control of the company's assets, notify creditors, and manage the distribution of proceeds. The process concludes when the company is dissolved, which can take several months.

The duration of liquidation depends on the complexity of the company's affairs. A straightforward creditors' voluntary liquidation might be completed within six to twelve months, while cases with legal disputes or complex asset realisations can take longer. The liquidator will provide an estimated timeline at the outset.

Alternatives include a company voluntary arrangement (CVA), which allows the company to repay debts over time, or administration, which aims to rescue the business as a going concern. Directors may also consider informal arrangements with creditors or restructuring. A licensed professional can advise on the best option based on your circumstances.

Once a company enters liquidation, the liquidator takes control and trading typically ceases. However, in certain cases, the liquidator may continue trading for a short period to realise assets or complete contracts. Directors must not trade without the liquidator's consent, as this could lead to personal liability.

Employees are entitled to claim redundancy pay, unpaid wages, and holiday pay from the National Insurance Fund, but the liquidator must first terminate their contracts. The liquidator will provide employees with the necessary forms and guidance. Claims for preferential debts are paid before unsecured creditors.

No, you do not need a solicitor. Licensed insolvency practitioners can be appointed directly by shareholders and creditors. However, if there are complex legal issues, such as director misconduct or disputes, seeking independent legal advice may be prudent. A liquidator can also refer you to a solicitor if needed.

Failing to follow proper liquidation procedures can lead to personal liability for directors, including for wrongful trading or misfeasance. Directors may also be disqualified from acting as directors for up to 15 years. Additionally, the company's assets may be dissipated, leaving creditors unpaid and legal action likely.