Liquidation
Creditors Voluntary Liquidation (CVL) is a formal insolvency process used by Directors, to close down a limited company that can not repay its debts. The CVL process commences with the Directors instructing a Licensed Insolvency Practitioner to act as Liquidator. Once appointed, the role of the Liquidator is to realise the value of the company’s assets in order to repay as much of the debt as possible. Once all the company’s assets have been dealt with, the Liquidator will close the company.
In the UK, over 1,000 limited companies enter Voluntary Liquidation every month. Creditors voluntary liquidation (CVL) is by far the most popular form of liquidation. This page deals with CVL’s however there are other types of liquidation available; see below.
For more information about our Business Finance solutions contact us today.
Advantages of Liquidation
Stops Bailiffs and Legal Action against the Company; including HMRC / TAX / VAT Enforcement
Process can be completed by Phone and Email – usually no need to attend any Meetings with Creditors
The cost of the Liquidation is usually covered by the value of company assets
No ongoing monthly payment plans
Simple process that does not require your Creditors to agree to it
The process can be completed in less than 10-days!
Employees can often claim unpaid wages, holiday pay and redundancy from the Insolvency Service*
Directors may also be able to claim back ‘thousands’ in unpaid wages and redundancy*
Directors could claim Thousands*
Once a company has been Liquidated, the Insolvency Service will usually make sure employees are able to recover unpaid wages, holiday pay, statutory notice pay and redundancy pay.
Most Directors we deal with are surprised to find out they are also potentially entitled to recover money from the Insolvency Service following liquidation. Anyone meeting the Governments criteria, including the Directors of the failed business, may be able to claim thousands.
Contact Neil for immediate help on 01204 255 051 or, email at the above address
About Anderson Brookes
Before discussing your financial affairs, we believe that you should check the credentials of the individual or organisation you intend speaking with. We are no different:
Anderson Brookes Ltd is Authorised and Regulated by the Financial Conduct Authority; our FCA registration number is 669796. You can confirm our details on the FCA website www.fca.org.uk
Anderson Brookes Insolvency Practitioners Ltd is a firm of Insolvency Practitioners. Rikki Burton is licensed to act as an Insolvency Practitioner in the UK by the ICAEW.
Anderson Brookes Ltd and Anderson Brookes Insolvency Practitioners Ltd are both registered at 6th Floor, 120 Bark Street, Bolton, Lancashire BL1 2AX
Anderson Brookes Ltd is Authorised and Regulated by the Financial Conduct Authority (FCA). Anderson Brookes Insolvency Practitioners Ltd is a separate company. Rikki Burton is Licensed to act as an Insolvency Practitioner by the ICAEW.
Yes. We offer a Free Consultation in all cases. We will ask questions to help us understand your circumstances and provide you with a specific recommendation. Should you decide to move forward with any recommendation we have made, we will confirm any costs involved in writing, before accepting your instructions. In some cases, there will be no charge made by Anderson Brookes for the services we provide.
Yes. Although we are based in Bolton, Lancashire, we deal with clients throughout the UK. Most of the work we do can be completed over the phone. You will not need to visit our offices; we can however, arrange to come and see you at your home or business if you prefer.
Yes. If we are instructed early enough, we are usually very successful in stopping bailiffs from removing assets. We have written a useful guide to the powers of bailiffs on this website; please visit our Help Guide section. Whilst the Help Guide is very useful, it is no substitute for specific personal advice. Please call us now and speak with a qualified Adviser.
In most cases, we are able to speak directly with the bailiff; once they understand your circumstances, they may allow us extra time to put a repayment plan together. If the bailiff is not receptive to our requests, we may be able to help you get a Court Order blocking bailiff enforcement action for around one month. This should give us all the time we need to put a formal repayment plan in place.
No. Call us straight away on 0800 1804 933, in most cases we can prevent CCJ’s from being enforced by bailiffs if we are instructed early enough.
No. You do not need to arrange an appointment, simply call us on 0800 1804 933 and we’ll be able to help. If you prefer, we can arrange to call you at a time convenient to you.
Questions about Liquidation
• Placing the company into Liquidation will stop debt enforcement including bailiff action.
• The Directors usually have control over the choice of Liquidator. As the Directors instigate the CVL process, they are able to meet with the Insolvency Practitioner prior to placing the company into liquidation and make sure they are comfortable with them.
• The process of placing a company into creditors voluntary liquidation can be completed within 2-weeks.
• There is usually no need for the Directors to attend any formal meetings. New rules introduced in April 2017, removed the requirement to hold a creditors meeting.
• The debts usually die with the company. The company’s debts are limited to the value of assets within the business; any debts remaining once all the company’s assets have been realised, will be written off. This may not be the case if the company’s debts have been guaranteed by the Directors or another party.
• In placing the company into liquidation voluntarily, the Directors can usually demonstrate that they have attempted to conduct themselves responsibly regarding the financial affairs.
No. Only a Licensed Insolvency Practitioner can liquidate a company.
No. Only a Licensed Insolvency Practitioner can liquidate a company. A Director can apply for their company to be dissolved, directly to Companies House if they meet the relevant criteria.
Please be aware… In certain circumstances, it can be deemed a criminal offence to make an application to dissolve a limited company that is insolvent. Directors should take professional advice before making an application to have a company struck off or dissolved.
If you think you may meet the criteria for dissolution, call us on 0800 1804 933 and we will talk you through the process.
A Limited Company may be forced into liquidation by one or more of its creditors. In the event of non-payment of a debt over £750, a creditor may petition the court to have the company liquidated. The application to court is known as a Winding Up Petition. If the creditors application to court is successful, the insolvent company is presented with a winding up order and is placed into Compulsory Liquidation.
Compulsory Liquidation can often present problems to the Directors of the company during the investigations that are carried out by the Official Receiver. For instance, it can be much more difficult for Directors to defend against allegations of Wrongful or Insolvent Trading where a creditor has forced the insolvent company into liquidation rather than the Directors instigating the process voluntarily.
This will depend entirely on your circumstances. In most cases, the Directors will not need to pay liquidation costs personally. The costs of the liquidation are usually covered from the realisation of company assets.
Anderson Brookes is a small insolvency practice based in Bolton, Lancashire and our operating costs are very low. We are therefore extremely competitive in terms of our charging structure. Before accepting any instructions, we will always confirm any fees and charges in writing. Please call us on 0800 1804 933 for more information.
Yes. Directors of the insolvent company are often keen to buy back the assets of the business. The liquidator has a duty to establish the value of any company assets before agreeing a sale.
So long as the transaction is carried out correctly, the Directors are free to buy back company assets and form a new limited company to trade through. This is perfectly legal and is sometimes referred to as setting up a ‘phoenix company’. The Directors should call 0800 1804 933 for advice, prior to forming their new company.
A Phoenix Company is a description often given to a new Limited Company established immediately following the liquidation of an insolvent business.
It is perfectly legal to form a new company from the remnants of a failed company. The phoenix company arrangement allows a business to start again and for the profitable elements of the failed business to survive, offering some continuity for both suppliers and employees. Before forming any new company, the Directors should call 0800 1804 933 for advice; there are potentially serious consequences if Section 216 of the Insolvency Act is breached in relation to the choice of company name.
The Directors of a solvent limited company may close down their company using a Members Voluntary Liquidation (MVL). The key difference between a Members Voluntary Liquidation and other types of liquidation is that the company must be able to repay all its debts in full at the time it is liquidated.
An MVL may be attractive to Directors and Shareholders looking to retire or return to an employed position. There can be significant tax advantages to closing down a solvent company using an MVL however, this is a complicated matter requiring specialist, technical advice. A Licensed Insolvency Practitioner must be appointed to deal with an MVL.
If a Limited Company is insolvent and you do not cease trading, you may be accused of Wrongful trading. A company can be deemed ‘insolvent’ if it can’t pay its debts as they become due or, its liabilities are greater than its assets.
A Court may make a Director of a company that has gone into insolvent liquidation, personally liable for some or all of the company’s debts if; at some point before the company was wound up, he knew or ought to have known that there was no reasonable prospect that the company would avoid insolvent liquidation and did not take every step to minimise the loss to the company’s creditors.
It is clearly more difficult for a Director to defend against a wrongful trading accusation where a creditor forces the company into liquidation rather that the Director taking the necessary steps to close it down.
If you feel your company may be insolvent, call us for immediate advice.
No. In fact, most of the people that call us for advice do not need a formal insolvency procedure. Before recommending any specific debt solution, we will help you consider all the options available to you. This will include providing you with self-help guidance and advice on informal debt solutions.
As you would expect, in the event that you do need insolvency advice our Licensed Insolvency Practitioner will be able to act on your behalf. Unlike some of our competitors, we would not need to refer you to an external company having recommended an insolvency process.
Yes. If we are instructed early enough, we are usually very successful in stopping bailiffs from removing assets. We have written a useful guide to the powers of bailiffs on this website; please visit our Help Guide section. Whilst the Help Guide is very useful, it is no substitute for specific personal advice. Please call us now and speak with a qualified Adviser.
In most cases, we are able to speak directly with the bailiff; once they understand your circumstances, they may allow us extra time to put a repayment plan together. If the bailiff is not receptive to our requests, we may be able to help you get a Court Order blocking bailiff enforcement action for around one month. This should give us all the time we need to put a formal repayment plan in place.
For more information about our debt solutions contact us today.
OTHER TYPES OF LIQUIDATION
Members Voluntary Liquidation (MVL)
If a Company can pay all its debts but needs to cease trading a Members Voluntary Liquidation (MVL) may be appropriate. A Members Voluntary Liquidation (MVL) is a Voluntary procedure to wind up the business of a Solvent Company.
The Members of the Company are the shareholders. To be classed as Solvent, the Company must be able to pay all its debts and the costs involved in winding up, within 12-months. A Members Voluntary Liquidation (MVL) is typically used where the shareholders of a Company wish to retire or close their business for any other reason than debt problems.
Compulsory Liquidation
Compulsory Liquidation is a process of winding-up an Insolvent Company through the Courts. The winding-up process is usually initiated by one of the company’s creditors once they have been unable to recover money owed to them through all other channels. Typically, as a last resort a creditor would apply to the Court for a Winding-Up Petition. In these situations, the Directors conduct will be investigated.
If your company is forced into Compulsory Liquidation, it can be more difficult to defend against allegations of Wrongful Trading.
THE LIQUIDATION PROCESS
Step One
Step Two
Step Three
Contact Anderson Brookes on 0800 1804 933 for advice. We will ask questions to make sure we understand the financial position of the company. We will then discuss all the options available with you including the specific costs involved. If, at that stage you decide to proceed with liquidation we will prepare the necessary paperwork.
We will ask you to sign various forms instructing us to act on your behalf. We will also help you prepare a ‘Statement of Affairs’ for the company; this is a document that details the assets and liabilities of the business. We will then send all creditors formal notification of the liquidation with a copy of the Statement of Affairs.
There is no longer any need for a ‘physical’ creditors meeting. The liquidation decision will usually be confirmed by way of a ‘virtual’ meeting. Following the meeting, we will notify all creditors of our appointment as Liquidator and ask that all future communication is directed through ourselves. We will then close down the company; including realising any company assets.
For more information about our debt solutions contact us today.
WHAT OUR CLIENTS SAY
“The service I received from Anderson Brookes was excellent. I’d already made the decision to cease trading but I didn’t know how to deal with my legal responsibilities as a Director. I went through the process of Creditors Voluntary Liquidation (CVL). Anderson Brookes helped me through every stage”.
“I write to you having recently used your company to arrange an IVA. Throughout this process I was stressed to the point of being unwell and encountered many obstacles, all of which Khalid walked me through. I am now beginning to start the process of getting myself on the right track, and this is largely thanks to Khalid’s pragmatism.”.
“Neil helped me through the process of Liquidating my company. Although closing-down the company was quite stressful, it was surprisingly quick and Neil made sure I knew what to expect at each stage. I have recommended other business owners to Anderson Brookes and always received great feedback”.
“Why my company ran into cash-flow difficulties, I was introduced to Neil at Anderson Brookes. We discussed lots of different options but I decided to place the company into Liquidation. The problems are now behind me and I’ve been able to set up a brand new, debt-free company”.
“Anderson Brookes helped me arrange a Business IVA. I was a sole trader and my plumbing business had run into financial problems. I was able to repay my debts through a voluntary arrangement over 5-years. I’m pleased to say; the business has been trading very successfully now for the last few years”.
“Just thought I would let you know that business is going extremely well I have no credit commitments, new car, new van and 2 good holidays a year and I really do owe all of that to you. I really appreciate your help in turning my life around. I would hate to think about where I would be if I hadn’t met you”.
“I was introduced to Neil at Anderson Brookes as I needed help with a financial problem. It turned out that I just needed to have all the options explained. Within a month of taking advice, the problem was behind me. I’m happy to recommend Neil and Anderson Brookes to anyone that needs advice on debt”.
“You were very helpful and professional. It was a very stressful time, thanks to your work and management, I was able to relax again.”
ADVICE YOU CAN TRUST
The Financial Conduct Authority (FCA). Anderson Brookes Ltd is Authorised and Regulated by the Financial Conduct Authority; our registration number is 669796. You can confirm our details at www.fca.org.uk
Rikki Burton ACA is licensed and regulated to act as an Insolvency Practitioner in the UK by the Institute of Chartered Accountants in England & Wales.
The Association of Business Recovery Professionals. R3 promotes best practice for professionals working with financially troubled individuals and businesses in the UK
The Information Commissioners Office (ICO), promotes data privacy for individuals. Our ICO registration reference numbers are Z5595675 and ZA201949
ANDERSON BROOKES GROUP
Anderson Brookes Ltd is a limited company registered in England and Wales; the company registration number is 4213701. Anderson Brookes Ltd is Authorised and Regulated by the Financial Conduct Authority (FCA); our FCA registration number is 669796. You can confirm our details on the FCA website www.fca.org.uk. Data Protection: our ICO registration reference number is Z5595675. Anderson Brookes Ltd does not administer ‘debt relief orders’, ‘debt management plans’ or handle ‘client money’. In the event we believe a debt management plan or debt relief order may be the most suitable debt solution we will provide you with the contact details of a reputable, non-fee charging organisation. The Money Advice Service are an independent service, set up by government to help people make the most of their money, they give free, unbiased money advice to everyone across the UK – online, over the phone and face to face. You can visit Money Advice Service at www.moneyadviceservice.org.uk
Anderson Brookes Insolvency Practitioners Ltd is a limited company registered in England and Wales; the company registration number is 10324159. Rikki Burton ACA is licensed and regulated to act as an Insolvency Practitioner in the UK by the Institute of Chartered Accountants in England & Wales. Our VAT Registration Number is 249 5912 70. Data Protection: our ICO registration reference number is ZA201949. Anderson Brookes Financial Services Ltd is a limited company registered in England and Wales; the company registration number is 08660228. Data Protection: our ICO registration reference number is ZA123471. All group companies are registered at First Floor, Fairclough House, Church Street, Adlington, Chorley PR7 4EX.
Anderson Brookes Insolvency Practitioners Ltd – Privacy Policy
Anderson Brookes Insolvency Practitioners Ltd operate a complaints procedure. In the first instance, please call 01204 255 051 or email info@andersonbrookes.co.uk to request a copy of the complaints process. If we are unable to deal with your complaint to your satisfaction, your complaint should be made to the Insolvency Complaints Gateway by visiting their website https://www.gov.uk/complain-about-insolvency-practitioner and completing and submitting their online form. Alternatively, you can print the form from their website and send it by post to The Insolvency Service, IP Complaints, 3rd Floor, 1 City Walk, Leeds, LS11 9DA or contact them by telephone on 0300 678 0015 (Monday to Friday 9am – 5pm).
Some of the services provided by Anderson Brookes are not regulated by the Financial Conduct Authority. Some of the debt solutions we provide advice on are only available in England and Wales; Anderson Brookes does not provide services outside England and Wales. Anderson Brookes is a commercial, profit seeking organisation; depending on the services provided, fees may be payable. Any fees applicable will be confirmed to you in writing before any chargeable work is completed. Anderson Brookes operates a complaints policy; if you are not happy with the way we have dealt with you or your case, please ask us for a copy of the policy.