Creditors Voluntary liquidation (CVL)

Insolvency occurs when a company cannot meet its financial obligations as they come due. This situation imposes legal obligations on the directors to act in the creditors’ best interests.

Consulting an insolvency practitioner should be considered when financial distress becomes evident. Early consultation can sometimes prevent formal insolvency through restructuring or negotiating with creditors.

An insolvency practitioner assesses the financial state of the business, provides advice on managing debts, and, if necessary, manages the liquidation process to ensure assets are distributed fairly among creditors.

A company can be liquidated in 3-4 weeks after all information is provided and the fee is paid. The process can be completed in 6-7 months.

No, the liquidator takes over these responsibilities once the liquidation process begins.

The company is removed from the register at Companies House approximately 3 months after the liquidation is concluded.

The money owed to you will be treated as a debt alongside other company debts, and payments are made once funds are available after liquidation costs.

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If staff are made redundant, they can claim redundancy payments from the government. Directors may also be able to make claims after formal liquidation.

The liquidator takes control of all remaining assets, selling them if necessary. Creditors are paid after the liquidator’s fee is deducted.

If the company doesn’t have enough cash to cover the costs, the director will need to pay the agreed fee. This cost is usually much lower than the company’s outstanding debts.