Liquidating a limited company: what is Member’s Voluntary Liquidation (MVL)?
MVL is the process of liquidating your limited company so the company can distribute its remaining assets to its shareholders. Changes to the rules in 2012 now dictate that if you have more than £25,000 profit left in your company, you will be required to liquidate your company and enter into Members Voluntary Liquidation. Since the assets paid to shareholders count as capital gains and not income, this is considered the most tax efficient way of getting money from your company.
To do this, you will need to appoint an insolvency practitioner who will carry out the process.
What does Caroolas insolvency service involve?
Caroola insolvency services offer an all-inclusive, low cost fixed fee Members Voluntary Liquidation (MVL) package which includes every aspect of what is needed to close down your limited company. Our insolvency service offers a plain English approach, keeping you fully informed at every stage of the company closure process.
Our MVL practitioner has over 15 years of experience in insolvency company closures and will work in tandem and directly with your accountant in order to get all the information that is required, so you never become embroiled with the process. We offer a hands-off approach for directors throughout, with almost every step of the process being done without the need for input. The end goal is simple; to ensure you receive the funds in your bank account in the swiftest and most tax efficient way possible.
What happens during the voluntary liquidation process?
The process can vary depending on your circumstances and the level of assets your company has, but follows the same basic rules. We’ve outlined the process below to provide a rough insight:
- As the director of the limited company, you will need to appoint a liquidator who must be a licensed insolvency practitioner. The liquidator will file appointment documents at Companies House.
- The liquidator will publish in The London Gazette (or the Edinburgh Gazette) a statutory notice of his appointment and a notice of insolvency will be submitted to HMRC.
- The liquidator will complete post-liquidation VAT return and deregister. They will then write to the bank to close the account and receive company funds.
- After 1 month the liquidator will distribute funds to the shareholders, final report will be prepared to the shareholders and a meeting is held and lastly, a final corporation tax return will be submitted for the post-liquidation period.
