Professional Company Liquidatorsin Gateshead

A company liquidator is a licensed insolvency practitioner who manages the closure of a company. They collect and sell assets, settle debts with creditors, and distribute any remaining funds to shareholders. They also investigate the directors' conduct and report to the relevant authorities if necessary.

Costs vary depending on the complexity of your case, the size of the company, and the number of creditors. Typically, fees range from a few thousand pounds to more for larger or more complex insolvencies. Always obtain a fixed-fee quote before engaging a liquidator.

Any limited company that is insolvent (unable to pay its debts as they fall due) can be placed into liquidation. This includes both compulsory liquidation (via court order) and voluntary liquidation (shareholders' resolution). A licensed insolvency practitioner will assess your company's financial position and confirm eligibility.

A straightforward creditors' voluntary liquidation can often be completed within six to twelve months. However, complex cases with many assets or legal disputes can take longer. The liquidator must also wait for the prescribed period for creditors to submit claims before distributing funds.

Compulsory liquidation is forced by a court order, usually after a creditor petitions for the company to be wound up. Voluntary liquidation is initiated by the directors and shareholders. In most cases, directors prefer voluntary liquidation because it offers more control and a smoother process.

Once liquidation begins, directors lose control of the company. The liquidator takes over and may continue trading for a short period to sell assets or complete contracts, but the company is effectively in the process of closure. You cannot continue normal trading without the liquidator's consent.

Alternatives include administration, company voluntary arrangement (CVA), or informal restructuring. Administration provides a moratorium from creditors while a rescue plan is attempted. A CVA allows the company to pay debts over time. An informal agreement with creditors might also be possible if debts are manageable.

Employees are made redundant when a company goes into liquidation. The liquidator will notify them and provide the necessary forms to claim statutory redundancy pay, unpaid wages, and holiday pay from the government's redundancy payments office. Employees are also preferential creditors for certain claims.

Directors must cooperate fully with the liquidator, providing all company records, accounts, and information. They may need to complete a questionnaire and attend meetings. Directors also have a duty to submit a statement of affairs detailing the company's assets and liabilities.

In most cases, directors are not personally liable for company debts unless they have given personal guarantees or acted wrongfully. If you traded while insolvent and knew the company could not pay its debts, you could be liable for wrongful trading. Professional advice is essential to protect your position.