There are 3 different types of Liquidation a company can enter into and below we have provided a brief overview:

CVL – Creditors Voluntary Liquidation

This is instructed by Directors and shareholders of an Insolvent Company and designed to make the Liquidation process as pleasant as it possibly can.

By instructing your own Liquidator it will improve your chances of avoiding implications such as Director Disqualifications or personal liability.

Your Insolvency Practitioner will guide you through every step and support you through these difficult times.

It makes a difference knowing you have someone fighting your corner and looking after your best interests by providing professional advice and making sure you are not crossing any boundaries that could bring further implications.

Compulsory Liquidation

This is initiated by a creditor issuing a Winding Up Order which enters the Company into Compulsory Liquidation.

The courts will appoint an Official Receiver who is an officer of the court. They will interview the Directors to see if they can build a case to disqualify them and to see if they can hold them personally liable for the company’s debts and costs of the Liquidator.

Many Directors do not want to take these risks and therefore prefer to go down the CVL route.

MVL – Members Voluntary Liquidation

This is where a solvent company is entered into Voluntary Liquidation because the Directors or Shareholders feel it is time to bring the company to a closure i.e: because they want to retire.

However this can only be achieved if the company has sufficient funds to pay its creditors in full within a 12 month period.