Understand your company's position and learn more about the options available
MVL vs Strike Off: Options for Solvent Companies
- Close Company With Debts
- No.1 For Liquidations
- Stop HMRC / Creditor Pressure
- 25,000+ Directors Helped
- Immediate Advice Available
- Insolvency Practitioners
Understanding your options for closing down a solvent company
Members’ Voluntary Liquidation, or MVL, is a process that’s commonly used by company directors looking to close down a solvent business and extract the cash in the business. An MVL requires the appointment of a licensed insolvency practitioner (IP), and as such, it attracts professional fees.
Company dissolution, also known as strike off, also results in the closure of the company but only costs £10. Despite this, however, opting for an MVL is likely to be the best option for most companies with a significant sum to distribute to shareholders.
Take Our Free 60 Second Test
Get an instant understanding of your:
- Debt and Asset Position
- Formal Insolvency Options
- Next steps
Plus much more ...Start The 60 Second Test
Hidden implications of striking off your company
If you look deeper into how each procedure works, and the potential implications for you as a director, the choice between the two processes isn’t quite as clear-cut. Other factors come into play, such as the peace of mind obtained when a licensed professional is involved, the potential for future litigation with company dissolution, and of course that cost.
So what should you consider when thinking about Members’ Voluntary Liquidation and company dissolution, and which process would be the best option when closing your limited company?
Looking to close your company?
Whether your company is solvent or insolvent, there are a number of ways to bring your business to a close. Speak to a member of the Real Business Rescue team today to understand your options.
The team are available now - 0800 644 6080
As we’ve already mentioned, Members’ Voluntary Liquidation attracts far higher costs due to the involvement of a licensed insolvency practitioner, who oversees and administers the process on your behalf.
Company dissolution is more of a ‘do-it-yourself’ option when a solvent company needs to be closed down, and apart from the expense of carrying out the necessary administrative steps, costs £8. But there’s another potential cost element involved with company dissolution that needs to be considered.
Can’t pay CBILS or Bounce Back Loan?
Don't worry - there are thousands of other company directors in the same position. If you are struggling to keep up with your Covid loan repayments, speak to a member of the Real Business Rescue team to discuss your options. It's Free & Confidential.
The team are available now - 0800 644 6080
Once the MVL process is complete, the liquidator instructs Companies House to remove the business from the Register of Companies. You can be certain that all your statutory duties have been fulfilled as they’re in expert hands, and there will be no potential for reinstatement of the company or claims by creditors.
With company dissolution, the opposite is true. You fulfil your statutory duties yourself as a director, including informing all creditors without exception that you intend to close the company down.
If you accidentally omit to tell a creditor of this situation they can apply to have your company reinstated up to 20 years later, and take legal action to recover their debt. Clearly, this could have legal implications for you personally, as you’ve gone ahead and closed a company that was supposedly solvent.
Company dissolution does have its advantages, but it’s important not to underestimate the work that’s needed to carry out this procedure. You have to follow a strict and formal timeline when dissolving a company, starting with ceasing trade three months prior to the application for strike-off.
Statutory accounts, returns, and tax payments must all be brought up-to-date, all creditors have to be informed, and crucially you must be certain that your business is solvent and can repay its debts within 12 months of strike-off.
Need to speak to someone?
If your company is struggling with unmanageable debts, squeezed cash flow, or an uncertain future, you are far from alone. We speak to company directors just like you every single day, and we are here to give you the help and advice you need.
Call our team today on 0800 644 6080
Members’ Voluntary Liquidation
MVL provides reassurance and peace of mind, as a professional assessment is made of your company’s financial position and a specialist is handling the procedure from beginning to end.
If you would like more information and advice on which process would be better in your circumstances – company dissolution or MVL – please contact one of our partner-led team at Real Business Rescue. We work from a large network of offices located around the country, and can offer you a free same-day consultation.
Further Reading on MVL vs Strike Off: Options for Solvent Companies
Real Business Rescue are here to help
Still unsure whether liquidation is right for your company? Don't worry, the experts at Real Business Rescue are here to help. Our licensed insolvency practitioners will take the time to understand the problems your company is facing before recommending the best course of action going forward based on your own unique circumstances.
- UK’s Largest Liquidators
- 100+ Offices Nationwide
- 100% Confidential Advice
- Supported 25,000+ Directors
Looking for immediate support?
Complete the below to get in touch
We provide free confidential advice with absolutely no obligation.
Our expert and non-judgemental team are ready to assist directors and stakeholders today.