Professional Company LiquidatorsServing Huntly Businesses

Costs vary based on the complexity of the case and the size of the company. A licensed insolvency practitioner will provide a fee estimate after an initial assessment. Creditors' voluntary liquidation is often funded from the company's assets, but you should confirm the basis of fees before you commit to any appointment.

Any limited company that is insolvent, meaning it cannot pay its debts as they fall due, is eligible. The directors must pass a resolution to wind up the company, and a meeting of creditors is then convened. A licensed practitioner must be appointed to act as the liquidator.

The initial appointment usually happens within a few weeks of the decision. The full process, including realising assets and distributing funds to creditors, often takes between six and twelve months. Complex cases with disputed claims or difficult asset sales can take longer to conclude fully.

Alternatives include a company voluntary arrangement, which is a formal agreement to pay creditors over a period, or administration, which aims to rescue the business as a going concern. Informal arrangements with creditors are possible but do not have the same legal protection as a formal procedure.

When a company enters liquidation, employees are usually made redundant immediately. The liquidator will handle the necessary paperwork and advise on claims for redundancy pay, notice pay, and holiday pay. These claims may be paid from the National Insurance Fund, subject to statutory limits.

Directors can be held personally liable if they have acted wrongfully, traded while insolvent, or given personal guarantees. The liquidator has a duty to investigate the conduct of directors. If assets have been misused, a claim can be made against the director personally to recover funds for creditors.

The licensed practitioner acts as the liquidator, taking control of the company's assets. They investigate the company's affairs, sell assets, agree claims from creditors, and distribute any funds available. They also have a duty to report any misconduct by directors to the relevant authorities.

A winding-up petition is a court action brought by a creditor to force a company into compulsory liquidation. If a petition is presented, the company's bank account is usually frozen. Directors can apply for a validation order to continue trading, but seeking professional advice immediately is essential.

You will need to provide a detailed statement of affairs, listing all assets and liabilities. This includes details of any money owed to creditors, a list of assets owned by the company, and information about any charges or security held by lenders. The liquidator uses this to assess the financial position.

Once a decision is made to wind up the company, directors must not incur any further credit. Trading while insolvent and knowing that liquidation is inevitable can lead to personal liability for wrongful trading. The company must cease trading immediately upon the appointment of the liquidator.