Although many directors of limited companies are entitled to redundancy should their company enter liquidation, there are certain criteria you must meet in order to be eligible. As well as being an employee of the company, you must also have been in this position for a minimum of two years and worked at least 16 hours per week. The way in which your company enters liquidation is also a crucially important factor in determining your eligibility.
Compulsory and voluntary are the two forms of insolvent liquidation. Both result in the closure of an insolvent company and both must be administered by an insolvency practitioner. The process is largely the same; the crucial difference between the two is how the liquidation process is initiated.
When it comes to claiming redundancy, it is important to know that whichever of these two routes the company enters liquidation through you may still be eligible to claim.
In order to qualify for director redundancy, the company must be insolvent and it also must go through a formal insolvency procedure. This means that should a company close in a solvent state (such as through a Members’ Voluntary Liquidation (MVL)) or is struck off the register by way of dissolution, director redundancy will not be a possibility.
If you are considering liquidating your company voluntarily, speak to us and learn how we can help you with making a claim for director redundancy. We can also help put you on the right path when it comes to starting the liquidation process.
If your company is being wound up or has already gone through compulsory liquidation, however, time is very much of the essence if you want to claim. Although we can still help you, there is a strict time limit for claiming. This is typically no more than six months from the date following the company being liquidated, however, the sooner the process is started the better.
To find out more about claiming director redundancy call our specialist advisers today. With unrivalled experience in the ins and outs of director redundancy, we can help you with any questions or queries you may have, as well as being perfectly placed to begin the claims process on your behalf.