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
YBSM PARTNERS
YBSM Partners is a Certified Accounting Firm with a difference. Providing Accounting, T...
Frequently asked questions
What is the difference between a Creditors' Voluntary Liquidation (CVL) and a compulsory liquidation?
A Creditors' Voluntary Liquidation (CVL) is a director-initiated process used when a company is insolvent but the directors choose to wind up voluntarily, often to avoid compulsory action. Compulsory liquidation is a court-ordered process, typically initiated by a creditor through a winding-up petition. In a CVL, directors retain control over the appointment of the liquidator and the process is more orderly, whereas compulsory liquidation removes control from directors and can lead to investigation into their conduct.
How much does company liquidation cost in North East London?
The cost of a CVL typically ranges from £4,000 to £8,000 plus VAT, depending on the complexity of the company's affairs, the number of creditors, and the asset base. For a simple, asset-light company, fees may be at the lower end. We offer fixed-fee arrangements with no hidden extras, and the fee is often paid from company assets if available. If assets are insufficient, directors may need to fund the liquidation personally, but we will always discuss all options upfront.
Can I continue to trade if my company is insolvent?
Trading while insolvent can lead to personal liability for wrongful trading if you continue to incur debts without a reasonable prospect of recovery. However, if you are taking steps to rescue the business, such as negotiating with creditors or preparing for a CVL, you may continue trading under strict supervision. It is crucial to seek professional advice immediately to avoid breaching fiduciary duties. Our liquidators can assess your position and advise on the legal boundaries of continued trading.
What happens to employees during a company liquidation?
In a liquidation, all employees are automatically dismissed once the liquidator is appointed, unless they are retained to assist with asset realisation. Employees are entitled to claim redundancy pay, unpaid wages, holiday pay, and notice pay from the National Insurance Fund (via the Redundancy Payments Service) as preferential creditors. The liquidator will provide each employee with the necessary claim forms and guide them through the process. We ensure all statutory employee obligations are met promptly.
Will I be personally liable for company debts after liquidation?
Generally, no. A limited company is a separate legal entity, so directors are not personally liable for company debts unless they have given personal guarantees, acted fraudulently, or engaged in wrongful trading. If you have provided personal guarantees for loans or leases, creditors can pursue you individually. Our role is to ensure the liquidation is conducted properly to minimise any risk of personal liability, and we will advise you on managing guarantees before the process begins.
How long does the liquidation process take in North East London?
A straightforward CVL can be completed within 6 to 12 months, but the timeline depends on the complexity of asset realisation, creditor claims, and any legal disputes. The initial appointment of the liquidator can happen within 2 to 4 weeks after the creditors' meeting. After that, the liquidator realises assets, investigates affairs, and distributes funds. We aim to close cases as quickly as possible, providing regular updates to directors and creditors throughout.
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