ACCOTAX - Accountants & Tax Consultants
Welcome to ACCOTAX, a firm of Chartered Accountants in London. The firm was established in 2009 and has helped thousands of businesses and individuals...See More
ACCOTAX - Accountants & Tax Consultants
Welcome to ACCOTAX, a firm of Chartered Accountants in London. The firm was established in 2009 and has helped thousands of businesses and individuals...See More
Frequently asked questions
What is the difference between creditors voluntary liquidation (CVL) and members voluntary liquidation (MVL)?
A creditors voluntary liquidation (CVL) is used when a company is insolvent and cannot pay its debts, and it is initiated by the directors to avoid compulsory winding up. A members voluntary liquidation (MVL) is used when a company is solvent and directors wish to close it down, often for tax efficiency or retirement. In an MVL, directors make a statutory declaration of solvency, and a licensed insolvency practitioner distributes assets to shareholders after paying all debts.
How much does company liquidation cost in Chase Side?
The cost of liquidation in Chase Side varies depending on the complexity of the case, the size of the company, and whether it is a CVL or MVL. For a simple CVL, fees typically start from around £3,000 to £5,000 plus VAT, while MVL costs may be higher due to the need for additional tax planning. We provide a fixed fee quote after an initial free consultation, ensuring no hidden costs or surprises.
How long does the liquidation process take?
A creditors voluntary liquidation (CVL) usually takes between 6 and 12 months to complete, depending on how quickly assets can be realised and creditor claims are resolved. A members voluntary liquidation (MVL) can be completed in as little as 6 to 8 weeks if the company is straightforward. After the final meeting, the company is formally dissolved and removed from the Companies House register.
Can I continue trading if my company is in liquidation?
Once a company enters liquidation, the appointed liquidator takes control of the business, and directors cease to have authority to trade or make decisions. Trading after liquidation is illegal and could result in personal liability for debts incurred. However, before liquidation, directors can continue trading if they believe it improves the position for creditors, but they must seek professional advice to avoid wrongful trading claims.
What happens to employees when a company goes into liquidation?
When a company enters liquidation, employees are automatically made redundant from the date of the liquidation order. The liquidator is responsible for settling employee claims, including unpaid wages, holiday pay, and redundancy pay, which may be recoverable from the National Insurance Fund (Redundancy Payments Service). Employees should contact the liquidator to submit their claims and receive guidance on the process.
Do directors face personal liability for company debts in liquidation?
Generally, directors are not personally liable for company debts if they have acted within the law and have not traded wrongfully or fraudulently. However, if directors have given personal guarantees, they may be pursued by creditors for those specific debts. Additionally, if there is evidence of wrongful trading, misfeasance, or breach of fiduciary duty, the liquidator can take legal action to recover funds for creditors.
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