There are a number of key steps to take in an members voluntary liquidation process
- to kick things off, the directors will hold a board meeting where they will form the opinion that the company will be able to pay its debts in full together with interest within 12 months from the date of the winding up.
- once the directors have assessed all the company accounts and agreed that the company is solvent, they must swear a statutory declaration of solvency. If they don’t have a reasonable belief that the company is able to pay all its debts within the next 12 months, then there are serious consequences for the directors personally, so they must be absolutely sure that this is the case.
- no longer than 5 weeks after the declaration has been sworn, the company itself will then pass a resolution to wind up. The shareholders and directors will have already decided on a liquidator to be appointed over the company, having discussed this in advance with the liquidator and gained their agreement to act for the company.
- following the company resolution to wind up, within 14 days it will need to file this resolution with the Registrar of Companies as well as publish it in the London Gazette, stating that a liquidator has been appointed, and giving the date of appointment.
- they will also need to file the declaration of solvency with the Registrar of Companies not more than 15 days after the winding up resolution.
- after this, the liquidator will give notice of the members voluntary liquidation to all creditors of the company of which they are aware, within 28 days of appointment. The process of gathering in the assets, undertaking liquidation sales and distributing the results of the liquidation sales to creditors and ultimately shareholders can then start to take place.
It is very important that the correct steps are followed in order to ensure that the company is put into members voluntary liquidation properly, and the liquidator is appointed.
In particular, it is vital that all of the information is available to directors before they swear the declaration of solvency or they could be personally liable for any false declaration. If you are considering a members voluntary liquidation then contact our team of experts who can go over the requirements with you and act on your behalf to make sure the process is carried out correctly.
At Francis Wilks & Jones we have acted for all types of company members voluntary liquidation and can guide you through the process, making sure that you avoid all pitfalls and that the process runs as smoothly and quickly as possible. We work with the top liquidators in the country, who like us are experts in their field. Contact us today if you would like to discuss your company situation further.