Ashcrofts can assist shareholders and directors with the winding up of a company. This process is called creditors’ voluntary liquidation and involves the winding up of a company and its affairs as well as the realisation of its assets for the benefit of creditors. Whilst a director can cease trading and propose for a company to be wound up, the process cannot be started until 75 per cent of shareholders agree.

We have over 30 years of experience in winding up companies, and have acted as liquidators in various sectors of Small to Medium size companies.
We work alongside stakeholders in order to maximise the return to creditors.

For more information and free initial consultation please contact us.

MVL is a voluntary procedure where a company with net assets over £25,000 is put into a solvent liquidation. Depending on the company’s circumstances the money paid out to shareholders is treated as a capital gain and not income which is taxed at a much lower rate. Members Voluntary Liquidation is a very tax efficient way of getting money out of a company and is usually done for tax purposes.

A creditor can commence the winding process if the creditor is owed £750 or more. A statutory demand is served upon the company which then has 21 days to comply with the terms of the demand. Directors should seek professional advice soon as possible.
Once the 21day period has passed the creditor can present a petition to the Court to wind up the company. Once the order has been made then the company enters Compulsory Liquidation and the Official Receiver is appointed liquidator.

We can take over as liquidators in a compulsory liquidation if we are nominated by a majority of creditors. We also take appointments from the Official Receivers Rota.

A CVA is a legally binding agreement made between a company and its creditors; unsecured, trade and tax, which ‘ring-fences’ old creditor liabilities and allows a company to move forward.

The company’s creditors are not written off in full but depending on what is agreed with its creditors a substantial amount may be written off. If the CVA is approved a timetable is agreed to pay the balance which does not starve the company of cash as it goes forward. The company can settle its new liabilities as and when they become due, and pay off the old liabilities from future profits, in accordance with the proposal agreed in the CVA.

This provides the company with a ‘breathing space’ and allows the administrator and the directors to formulate a plan to restructure and rescue the business or sell the business or its assets, to achieve a better return for creditors than would be available in liquidation.