We feel that most of you will already be familiar with the contents of this article so we won’t labour the points however we do think it is worth briefly reminding everyone of the main benefits of solvent liquidation:
Tax Efficiency for Shareholders
Where directors/shareholders are looking to close a company which has more than £25,000 of assets, this value can often be extracted as capital (with associated lower tax liability) rather than income by appointing a liquidator. Where Entrepreneur’s Relief can be obtained, shareholders might pay as little as 10% tax on the distributions they receive from a liquidator.
Peace of Mind for Directors
deadline is set for creditors to submit their claims to the liquidator and this is advertised. Clearances are also sought from HMRC (who typically take about six weeks to respond) prior to a distribution being paid to shareholders. We have seen directors forget or be unaware of a potential creditor claim which is subsequently put to the liquidator and, once the liquidation process has been completed, it is unlikely that anything will come back to ‘bite’ the directors. By contrast, where a company is simply struck off before undergoing the liquidation process, although this may be cheaper, any creditor out there can make an application for the company to be restored, even if years have passed since the company was struck off.
We offer efficient solvent liquidation services for competitive fees where shareholders can expect to receive a substantial distribution within six weeks of the company entering liquidation (or even sooner where urgent circumstances dictate and indemnities are provided). Please do not hesitate to contact us in the event you wish to discuss this further.
Antony Antorkas, Nick Cusack, David Perkins and all of the Parker Andrews Team