What is voluntary winding up? How does voluntary liquidation work? To pass a resolution for members ’ voluntary liquidation , you must: make a ‘Declaration of solvency’ – English and Welsh companies ask the Accountant in Bankruptcy for form 4. The company’s Directors or Shareholders may wish to retire, move overseas or alternatively they are an IRcompany. Theeffect in either case is that a liquidator is appointed to bring the company’sexistence to an end so that it can be dissolved.
Where the decision to go intoliquidation is taken voluntarily and the company is insolvent and cannot payall its creditors in full, the liquidation is termed a ‘creditors’ voluntaryliquidation’.
If the company is solvent and can pay all its creditors in full,the liquidation may be a ‘members’ voluntary liquidation’. See full list on mw-w. The catalyst for a members’ voluntary liquidation is adecision by the directors that the company has no further purpose and thatavailable assets should be realised and distributed to shareholders. Thedecision may be prompted by tax planning considerations within groups ofcompanies or as part of group or company reorganisations or reconstruction’s. (more…)