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What is the procedure for a member’s voluntary liquidation for a group?

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Leading UK
What is the procedure for a member’s voluntary liquidation for a group?

An MVL, or Members’ Voluntary Liquidation, is the formal process of winding up a solvent company. When the decision has been made to close the company, an MVL is a cost-effective way to do this. To be eligible for an MVL, the company must be in a position whereby it has paid all of its contractual obligations and creditors, including any PAYE, VAT and tax, or is able to in full within twelve months, and thereby is considered solvent.

A licensed insolvency practitioner is appointed by the directors to act as the liquidator in the process who will take control of the company, work with the directors to conduct all the necessary formalities and paperwork, and finally dissolve the company and remove it from the Companies House register.

It is worth noting that for solvent companies with less that £25,000 in retained profits, there is also the option of dissolving the company, known as ‘striking off’. However, once the company is dissolved, any remaining capital or assets in the business will transfer to the Crown automatically. So, if you choose the dissolution route, make sure all assets are extracted first or you may have to apply to have the company restored to the Companies House register to reverse the strike off.

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