Members’ Voluntary Liquidation
A Members’ Voluntary Liquidation (“MVL”) is a process whereby an Insolvency Practitioner is appointed as the Liquidator of a solvent company to extract the shareholders’ capital in a quick and tax efficient manner or to reorganise a company. The process will only involve the Directors and a meeting of the company’s members, this process can be executed in a very short space of time.
As stated above, an MVL is an appropriate process where there is to be a reorganisation of group companies, retirement of a company’s owners or the completion of works which leads to the end of the requirement for a company.
Our fees for advising on and delivering an MVL can almost always be fixed and agreed with the Directors at the outset of the procedure.
A declaration of solvency must be sworn by a majority of the directors, confirming that all creditors can be paid in full, including statutory interest within 12 months.
The directors must be aware that it is a criminal offence to swear a declaration of solvency, when the company is not solvent, so they should exercise caution when doing so.
There is no investigation into the company’s financial affairs or a requirement to submit a directors’ conduct report as the company is solvent. Once the company’s assets have been distributed the liquidator ceases to act and the company is subsequently struck off.
The team at Live Recoveries are here to assist in the process of dealing with any residual creditor claims, assisting a company’s accountant in finalising returns to HM Revenue & Customs and distributing the capital to shareholders in a quick and efficient manner.