Company Liquidation

If your company is insolvent, and you want to limit your liability - liquidation is the simple solution.
Call 01242 576 555 now.

Get a Quote Online

Company Liquidation

The primary purpose of a limited company is to liquidate it.

Let's be honest, limited liability is why you formed the company in the first place – to avoid personal liability for the debts of the business in the event it went bust.

In the event of insolvency, to limit your liability, you need to liquidate the company.

When a limited company is placed into liquidation, the shareholders and directors are not personally liable for the debts of the company, unless personally guaranteed.

Once the company is in liquidation, creditors cannot take legal action against either you or the company (except for any personal guarantees).

The Liquidator once appointed, takes legal control of the company from the directors and deals with the winding up, at which point the directors are free to pursue new opportunities.

How to Liquidate

It is cheap, easy and fast.

It is a simple three step process, involving three meetings:

  1. Directors board meeting
  2. Shareholders meeting
  3. Creditors meeting

The directors are able to buy the assets of the company from the Liquidator, should they wish to do so, and use the assets to trade a new business.

Only a licensed insolvency practitioner is legally able to act as liquidator.

Call us on 01242 576 555 to speak direct to an insolvency practitioner, or click 'free advice' to request a callback:

Free Advice

Register for Free Advice

Risks for Directors

The Liquidator will undertake a review of the director’s conduct and report any evidence of unfit conduct to the disqualification unit of the government Insolvency Service, and this may lead to a ban from acting as a director in future.

For smaller companies, the chances of action being taken against the directors are limited.


In the current climate when many well managed companies are in financial difficulty due to the economic conditions, the prospect of a ban is low, especially in smaller cases with less than say £100,000 in liabilities.

To talk through your company's situation and the implications for the directors, call:

01242 576 555

Your Best Option

Why is Liquidation the Best Option for a Small Company that has run out of Cash
It is cheap, easy and fast.

Assets can be acquired at a distressed value, and payment terms can be agreed with the Liquidator.

The Liquidator takes his fees from the asset realisations, unless there are no assets, in which case he will act on a fixed fee payable in advance.

Voluntary Liquidation

Voluntary Liquidation is usually the most realistic option to achieve a business recovery, by buying the assets from the Liquidator, or alternatively undertaking a pre-liquidation asset transfer. While these options may appear underhand, they are commonplace and perfectly legal so long as certain key rules are complied with.

That is why it is important to instruct experienced professionals to deal with what is a sensitive, commercial matter.

CVA's - The Risks

CVA or Company Voluntary Arrangement is where instead of liquidating, you make a proposal to pay off the debt over a period of time. This can sound like a great deal when your back's against the wall, but the reality is that it is tough trading a company that is in a CVA.

The monthly payment into the CVA is a burden on the cash flow, and often leads to arrears in PAYE and VAT building up.

Because the CVA is registered at Companies House, the company’s credit rating is zero, and it is hard to obtain credit terms from suppliers, most of whom are owed money. Competitors use it against you, and it can be tough on morale.

If you fail to meet the monthly payments for two months, or get 60 days in arrears with HMRC, then the company will be forced into Liquidation at any point during the usual 5 year CVA.

Most companies that try a CVA end up back at square one, in Liquidation, and the directors usually wish they had gone down the Liquidation route from the start. The main advantage of a CVA is there is no conduct review of the directors by the Insolvency Service.