Simple Liquidation blog

What was formerly known as Entrepreneurs Relief is now known as Business Asset Disposal Relief (BADR). It is a tax relief benefit that can reduce the Capital Gains Tax (CGT) that is paid on the sale of the assets of a solvent company that is either being liquidated or sold. When a solvent company is liquidated, it is through a Member’s Voluntary Liquidation process in accordance with the laws dictated by the Insolvency Act 1986. When the assets of the solvent liquidated company are sold, CGT is applied but directors of the company that qualifies for BADR are able to pay half the amount of tax on the capital gains rather than the standard amount. So, how does Business Asset Disposal Relief work ?

Business Asset Disposal Relief reduces the amount of Capital Gains Tax ( CGT ) on a disposal of qualifying business assets on or after 6 April 2008, as long as you have met the qualifying conditions throughout a 2 year qualifying period either up to the date of disposal or the date the business ceased. Business Asset Disposal Relief was known as Entrepreneurs’ Relief before 6 April 2020. In order to take advantage of this tax relief, the company needs to go into a solvent liquidation process [Members’ Voluntary Liquidation-MVL] and the Liquidator will make capital distributions to shareholders, thereby enabling them to make the Business Asset Disposal Relief claim in their own Tax Returns. Who can claim relief Business Asset Disposal Relief is available to individuals and some trustees of settlements, but it’s not available to companies or in relation to a trust where the entire trust is a discretionary settlement. Personal Representatives of deceased persons can only claim if t...

For any company or personal insolvency procedure or for the closing of a solvent business in the United Kingdom, it must be handled by a licensed insolvency practitioner (IP). But finding one that is able to handle your situation and that you can work with is another matter. However, there are several sources you can use to help you find a licensed insolvency practitioner in your area and specialises in your type of business or personal situation. What is a licensed insolvency practitioner? A licensed insolvency practitioner is someone that is qualified, licensed and authorised to act on behalf of an individual, partnership or company that is either insolvent. In most cases, insolvency practitioners work in a law firm, an accountant or a specialist insolvency practice. However, they are also required when a solvent company is being closed down, known as winding up.. To practice as a licensed insolvency practitioner, they are required to: READ MORE

British Steel was created in 1967 as a nationalised company and was established as part of the Iron and Steel Act 1967, largely in response to the huge demand for steel following the Industrial Revolution. The company was later privatised in the 1980s and has since undergone major changes over the years, particularly in the 1990s when the demand for steel dropped. By 1999, the company merged with Koninklijke Hoogovens, forming Corus and in 2007, it was bought out by Tata Steel. By 2016, Greybull Capital purchased Tata Steel’s European business, including British Steel, and went on to buy FN Steel. However, just three years later in May 2019, it was announced that British Steel had been placed into compulsory liquidation following failed talks for emergency funding from the UK government. READ MORE

Company insolvency is not an easy situation to deal with; what’s also a difficult decision is deciding which route to take to resolve the situation. Is it better to liquidate the company and use its assets to pay back creditors? Alternatively, if the company is worth saving, is administration a better option to give your insolvency service time to source a buyer for the business? Making a choice between liquidation vs administration is always a decision that should be discussed with your insolvency practitioner who will be able to give you an unbiased opinion. But understanding the two options and what they involve will help you.

 Having to admit insolvency and face liquidation is not easy for any company director. No liquidation process is easy but what will make the process simpler is professional liquidation solicitors. When entering into a CVL (Creditors Voluntary Liquidation) or an MVL (Members’ Voluntary Liquidation) process, it must be handled by a licensed insolvency practitioner (IP) in accordance with the Insolvency Act 1986. Liquidation solicitors, like Simple Liquidation, have a team of IPs that are able to manage the entire procedure, keeping it simple and guiding you at every step. READ MORE

Debt is not an easy matter to deal with. The last couple of years have possibly been the hardest for many businesses, large or small, due to the impact of the coronavirus pandemic. Sadly, for some business owners, it’s difficult to see a way past the debt and into recovery. Being in debt, whether it’s full insolvency or just excessive debt, needn’t be the slippery slope to liquidation.  Seeking professional advice from an insolvency practitioner is the first step to business recovery; it could be the difference between closing the business and coming out the other side of debt and thriving in the future. What are business recovery services? One of the tasks of an insolvency practitioner (IP), when assessing a business’s financial debt situation, is to see if the business can be rescued from insolvency and liquidation. Their experience and knowledge helps them advise company directors about potential business recovery plans that can help them recover. READ MORE