Professional Company LiquidatorsGuidance Across South Yorkshire

A company liquidator is an insolvency practitioner who manages the process of closing down a company. Their main role is to realise the company's assets, settle any outstanding debts with creditors, and ensure that all legal requirements are met, whilst also investigating the conduct of directors during the lead-up to the liquidation.

The cost of a liquidation can vary significantly depending on the size and complexity of the company. The practitioner's fees are often paid from the company's assets. If there are no assets available, a director may need to consider funding the process personally to ensure creditors are dealt with properly.

The length of time for a liquidation to conclude depends on the specific circumstances of the company. A straightforward case might be completed within six to twelve months, whilst a more complex case with many assets or legal disputes could take several years to fully wind down.

To enter a Creditors' Voluntary Liquidation, the company must be insolvent, meaning it cannot pay its debts as they fall due. The directors must formally declare this and pass a resolution to wind up the company, which then requires approval from the shareholders before a liquidator is appointed.

Once a company enters liquidation, the liquidator takes control and the directors' powers cease. Trading is generally not permitted after this point, except in very specific circumstances where the liquidator may continue trading for a short period to sell stock or complete work in progress for the benefit of creditors.

A Members' Voluntary Liquidation is used for a solvent company where directors can make a declaration of solvency, meaning the company can pay its debts in full within a set period. A Creditors' Voluntary Liquidation is used for an insolvent company where this declaration cannot be made and creditors are involved in the process.

When a company goes into liquidation, all employees are automatically made redundant. The liquidator is responsible for ensuring that employees receive their statutory redundancy pay and any outstanding wages or holiday pay they are owed, often claiming these amounts back from the National Insurance Fund.

Yes, there are several alternatives to liquidation, including a Company Voluntary Arrangement, which is a formal agreement to pay creditors over a period of time, or administration, which can provide a moratorium from creditor action. Informal arrangements with creditors are also possible, but they do not offer the same legal protection.

As a director, you have a duty to cooperate fully with the liquidator. This includes providing all company records, accounts, and any other necessary information. You must also be honest about the company's financial history and your conduct, as the liquidator has a legal obligation to investigate your actions.

Generally, you will not be personally liable for company debts if the company is liquidated properly. However, if you have given a personal guarantee for a business loan or other credit, you will still be responsible for that debt. Also, if wrongful trading or misfeasance is found, a court could make you personally liable.