Posted on: Monday 21st May, 2018
There are several ways to close down a limited company, the best one for your business depends on its financial situation and what you want to achieve as part of the closure.
During this two month period, anyone can object to the striking off application and ask Companies House to keep your company active. This is likely to be the action taken if you have any outstanding creditors. Once your company is struck off the register it no longer exists, and consequently cannot be chased for any money it owes. It is therefore in a creditor’s interest to ensure your company remains active and on the Companies House register.
Strike off is only for those companies who do not owe any money. If your company has outstanding debts that it cannot pay, you will have to consider a formal insolvency process instead.
If you have money or assets you want to extract from the company, the best way of doing this is a tax-efficient manner is to opt for a Members’ Voluntary Liquidation (MVL). This allows you to take advantage of Entrepreneurs’ Relief (EF) which can save you a considerable amount in tax. ER allows you to pay a reduced about of Capital Gains Tax on disposals up to £10 million.
Depending on how long you have been running your company, you may be entitled to redundancy pay once your company is liquidated. Find out more about your eligibility for redundancy and how much you may be able to claim here.
Before closing your company, you should seek expert help and advice to ensure you are meeting your obligations as a director. If you would like to be assessed for potential directors’ redundancy, give our experienced advisers a call today.