What is creditors voluntary liquidation and how Creditors Voluntary Liquidation Works and the Effect on the Business?

 Creditors voluntary liquidation is a formal insolvency process in which the directors of a company voluntarily choose to stop trading and wind up the insolvent company.

A company has to go through from both good and bad times. when a company is suffering from debts and the creditors are demanding for the repayment than the directors of the company have two options the one is creditors voluntary liquidation and another one is compulsory liquidation in which creditors will have petitioned the court and forced the company into compulsory liquidation.



A CVL is a formal insolvency process in which the directors of a company voluntarily choose to cease trading and wind up the insolvent company and their is no one company director wants to be in this position, it is often the best course of action for all parties. So, how does a Creditors Voluntary Liquidation work and in what way does it affect the business.

If a company is unable to meet its financial liabilities. it is classified as an insolvent company. In this situation, it is important that the company ceases trading; if the business continues to trade, the directors could be held personally liable and it could result in the insolvency practitioner reporting wrongful trading and legal action should be taken against them.


Simple Liquidation was designed to provide directors like you with a quick and simple solution to liquidate a company.  Our liquidators are authorised by the Insolvency Practitioners Association and the Institute of Chartered Accountants in England and Wales.

Location: Norwich, UK

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