Do Directors go to Court to Liquidate a Company?

 

 

 

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Do directors go to court if they liquidate their limited company? A common question we get asked a lot from directors is when discussing company liquidations: Do directors go to court? Well, the simple answer is no. If you go through a Creditor's Voluntary Liquidation, check out some of our other videos on what a voluntary liquidation is on some of the other web pages to find out more information. But let's talk about this now.

A Creditor's Voluntary Liquidation is a process initiated by the directors of insolvent companies. You engage an Insolvency Practitioner who becomes the liquidator. They will then provide you with a list of information that the directors need to provide, like utility bills, director ID, sets of management accounts, creditor lists, HMRC reference details, etc. This is nothing that you or your accountant shouldn't have on hand and most of which can be provided online or if you require a face-to-face meeting.

However, if the business goes through a compulsory liquidation, it means a creditor has decided to close the company down due to being owed more than £750, and it is a court process. Once in court, the case will be appointed to the official receiver, who will ask a series of questions which must be answered by you, the directors. In either scenario, it is unlikely that you will need to physically attend court.

I hope this helps. If you have any further questions or queries whatsoever, please give me or one of the Real Business Rescue team members a call as soon as possible.