“What if there was a way we could quickly close the company and get rid of the worry and pain? I don’t want to risk personal liability and we need to stop the creditor pressure.”

There is a solution, it is called creditors voluntary liquidation.

What does liquidation mean and how does it work?

Read on and we'll help you answer those questions

This page contains a simple guide and fast links to more detailed guides to the creditors voluntary liquidation insolvency mechanism.

FIRST the simple description of a creditors voluntary liquidation (CVL).

What is liquidation?

Many people ask us this and it's really a straight forward answer: creditors voluntary liquidation or compulsory liquidation means the end of the company and its assets are then "liquidated" or turned into cash for the creditors.

It is quick, CVL brings an end to worry, if you have acted properly, and it will allow you to get on with your life.

Click Voluntary Liquidation detailed guide if you want to learn more about the CVL process.

Click Creditors Voluntary Liquidation flowcharts if you would prefer a simple-to-follow liquidation flowchart.

Click Creditors Voluntary Liquidation FAQ's if you would prefer frequently asked questions guide to help you understand the longer guide.

Click Wrongful Trading if you are worried about your actions.

Click Compulsory Liquidation if your company faces a winding up petition

Creditors voluntary liquidation is the most common form of liquidation in use in the UK. There will be around 8-12,000 voluntary liquidations each year in the UK depending upon the economic climate. Its often more, so you are not alone!

Usually the company has run out of cash, it cannot pay its debts on time and the directors are concerned that the business is simply not viable.

They are also very worried about Wrongful Trading.

They choose to stop trading and close the business. A licensed insolvency practitioner is appointed as liquidator by the creditors at a creditors meeting. Then he/she will deal with the remains of the business. Directors get on with their lives and often that's the end of that. Sometimes a phoenix is proposed.

What is a "Phoenix"? You can liquidate a company and start the same business again, but only under strict rules and conditions. This is a potential legal "minefield" and you need to take proper advice. Call us or read the detailed CVL guides if you want more details.

What if the company can be viable?

But, before you decide on liquidation as the correct option, you should also consider whether your company can be viable if radically restructured and, if so, how can you get help. If there is a viable business in there but you are tired and distressed we can still help. Many people call us saying liquidate my company please! Then once we take away the pressure and look harder at the business problems we can often see a solution. This could be trading out or a company voluntary arrangement.

Because CompanyRescue is on the outside looking in we can often see possibilities that you cannot. We are also experts at using the law to restructure companies so call us and discuss liquidation versus the GO options. Our advice is always this: consider all other options like CVA first before deciding to liquidate!

Clearly, if the company has decided to liquidate, we can help you with the process quickly and with understanding. One of our national team of insolvency practitioners can start the CVL process as quickly as today for you if that’s the right decision.

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