My business has been gradually accumulating debt for a while now, but in the last year I’ve been unable to turn a profit at all. It is becoming a financial burden to keep investing in this when I know that realistically my effort will not be rewarded. The business is registered in the UK as a limited company. How would I go about formally closing the company with the least hassle?
If you have made your mind up that it is time to wind up your limited company, the first thing to consider is whether there are any other directors, members or shareholders who need to be a part of the decision making process. Without a resolution to wind up/dissolve a company, you cannot proceed. Also, it needs to be taken into consideration whether your company is solvent or insolvent. The process for closing a company in the UK depends on whether or not there are any outstanding debts which you have no hope of paying.
There is a process for winding up a limited company in the UK called Members Voluntary Liquidation. This is appropiate if you believe that the company's debts can be paid within a timeframe of 12 months after winding up begins, then this is the best solution. However, if your company is insolvent without hope of meeting that deadline, you would need to pursue a Creditors Voluntary Liquidation.
Once all assets, in either case, have been liquidated, the company can be struck from the register at Companies House. We would recommend that you speak with a licensed insolvency practitioner to discuss your financial circumstances before you do anything. You want to be sure you proceed in the proper manner so as not to slow down the process. You may believe your company is solvent, but if there is even the remotest possibility that it will not be possible to pay all creditors, you would need to switch midstream from an MVL to a CVL.
We are here seven days a week and it only takes a quick phone call to set up a free consultation. Closing a company in the UK is not what we like to see, but we can help you successfully cease trading and strike your company off the register. You are looking for the most effortless way to accomplish this and we can help.
24th October 2016 The number of British companies in a financially distressed position fell during the third quarter of this year in comparison with the previous quarter and the same period of 2015.
11th October 2016 UK’s Pensions Regulator has called on the government to give her office more power to intervene in scenarios where companies are being sold while carrying large-scale pension deficits.
10th October 2016 A swathe of newly-leaked documents appear to illustrate how the Royal Bank of Scotland (RBS) systematically squeezed struggling businesses in order to boost its own revenues and profits.
5th October 2016 A total of 101 people have been made redundant following the entry of the steel contracting business AIC Steel Limited into administration in recent days.
13th September 2016 The frequency with which HM Revenue & Customs (HMRC) is stepping in to seize assets of companies who are heavily in debt increased sharply over the past year.
Every day we help companies just like yours turn things around against seemingly impossible odds, regardless of your situation we can help. Find your nearest office today.