Step-by-Step Guide to Dissolving Your Limited Company in the UK

Thinking of dissolving your limited company? Maybe the business isn’t quite cutting the mustard anymore, or you’re just ready to call it a day. Whatever your reason, you’ll need to go through the proper steps to shut up shop officially. At Simple Liquidation, we’ve helped hundreds of directors navigate this minefield, from solvent closures to sticky insolvent situations. We’re not some middleman flogging leads, we’re the real deal. Our licensed insolvency practitioners roll up their sleeves and get stuck in to help you sort it from A to Zed.

So, let’s crack on. Here’s your no-nonsense, step-by-step guide to dissolving your limited company in the UK.

Step 1: Decide if You’re Solvent or Insolvent

Before anything else, you’ll need to figure out your company’s financial position. Is the business:

Solvent – Can it pay off its debts in full?

Insolvent –  Finding it difficult to keep up with bills, or feeling overwhelmed by HMRC correspondence?

If your company’s solvent, you might be able to go down the Members’ Voluntary Liquidation (MVL) route. If insolvent, it’s more likely you’ll need a Creditors’ Voluntary Liquidation (CVL). Don’t worry, we’ll explain both. At Simple Liquidation, we handle both routes, so whether you’re bowing out on top or buried under paperwork, we’ve got your back.

Step 2: Members’ Voluntary Liquidation (MVL) – For Solvent Companies

If you’re solvent and looking for a tax-efficient way to close up shop, MVL is your best mate. It’s tidy, quick, and helps you get the most out of your final distributions.

The process looks like this:

Board Resolution:

You and the directors hold a meeting and agree it’s time to call it quits.

Declaration of Solvency:

You’ll need to sign a statutory declaration swearing the company can pay its debts plus a bit of interest, within 12 months. Lying here? Big no-no. It’s a criminal offence.

Appointment of a Liquidator:

That’s where we come in. Our licensed insolvency pros, like Jamie Playford and Alex Dunton, step in and take control. We make sure everything’s done by the book.

Distributions and Closure:

After selling off any remaining assets and paying creditors (if needed), we’ll sort your final accounts and close the company for good.

MVL Perk: You may qualify for Business Asset Disposal Relief (formerly Entrepreneurs’ Relief) and only pay 10% Capital Gains Tax on what you receive. Not too shabby, eh?


Dissolve Your Limited Company in the United Kingdom

Location: London, UK

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