What is Members Voluntary Liquidation?
Members Voluntary Liquidation is a solvent Liquidation. If this option is appropriate, your company must have sufficient assets to settle its debts within 12 months.
An MVL may be used for purposes of reorganisation or in the case of owner-managed businesses, to enable the shareholders to realise their interest in the company.
A Liquidator is appointed by your shareholders.
What do I have to do?
You will be asked to produce a schedule of all assets and liabilities. This is known as a Declaration of Solvency. You and your fellow directors will then have to pass resolutions at a Board meeting and the members (shareholders) will attend an Extraordinary General Meeting. At this point, the company would cease trading if it had not already done so.
How will Armstrong Watson help?
If we are appointed as Liquidator, we will:
- Call all meetings and deal with the relevant paperwork
- Realise all assets of the company, including book debts
- Deal with creditor queries and agree claims
- Pay dividends to creditors after payment of fees
- Pay balance to shareholders
- Summon final meeting once duties have been completed
- Company would be dissolved three months after the final meeting
How long does an MVL take?
An MVL process lasts as long as it takes to complete all the objectives; usually this takes between six months and a year.
How much will an MVL cost?
The Liquidator is usually remunerated on a time-cost basis from funds paid into the Liquidation account from the liquidated assets. The fees are determined by the complexity of the case.
IMPORTANT NOTE
If it is discovered that your company is unable to pay its debts, it will become Insolvent. In this situation, the company will be placed into Creditors Voluntary Liquidation as soon as it becomes apparent that the MVL is not going to pay all creditors in full.