Successful Members Voluntary Liquidations

Members Voluntary Liquidations – Our Latest Testimonial

One of our most recent Members Voluntary Liquidations was for a tobacco importer, Sabac Trade Ltd, where the director was retiring and wished to wind up his company in the most tax efficient way. This article features a testimonial from the director, Sandro Agostini, who was delighted with our work on this solvent liquidation, which was successfully completed in November 2017.

The Details of this Members Voluntary Liquidation

The director had incorporated the Company in London in October 2010, and had always traded profitably. Having decided he wanted to retire and  realise the assets of his Company, he contacted one of our Licensed Insolvency Practitioners, Hugh Jesseman, at our London office, for an initial discussion via his accountant. Hugh was appointed to act on this Liquidation on 8 March, supported by his colleague and senior insolvency administrator, Sunney Sagoo.

Our Work was Quick and Efficient

We made sure that any tax due was paid prior to the appointment, following recent HMRC changes incorporation tax payments for MVLs (see more below). This paved the way for the first distribution to take place on 7th April 2017, less than a month after we started work. The total cash in the case was £384,547 of which £380,708 went to the shareholders, who were all family members. The Liquidation was finally closed in November, 2017, the whole process taking 8 months. The client was delighted with our work, and said:

I take this opportunity to thank both Hugh and yourself for your friendly and efficient service in liquidating Sabac Trade Ltd. and would not hesitate in recommending you.”

Interested in this Liquidation Testimonial? Want to find out more?

If you or your business is facing insolvency, the sooner you contact us, the more we can help.

Contact us for a FREE Initial Consultation

Click here to see some more of our MVL testimonials.

Why Pay the Tax Early? A Change in Corporation Tax Payments for Members Voluntary Liquidations from HMRC

MVLs are used for solvent liquidations, which are typically undertaken for tax reasons or in the case of owner-managed businesses – as this was – to enable the shareholders to realise their interest in the company, when they do not have succession or selling plans, in the most tax efficient way.

Inevitably, HMRC keeps a close eye on such insolvency procedures, their remit being to collect as much tax as is due. In late 2017, HMRC announced a change in policy when dealing with corporation tax payments in Members Voluntary Liquidations. The new policy enables HMRC to claim statutory interest at 8% per annum, starting from the date of liquidation, even if the normal due date for corporation tax hasn’t yet passed. It’s not just corporation tax, either, with all taxes payable at a future date – VAT, PAYE, etc. – being included.

It was for this reason that we made sure that any tax due in this MVL was paid in advance of our appointment. If statutory interest is to be mitigated or avoided, then planning ahead for the liquidation makes sense, by:

Click here for more details on this new policy from HMRC.

Contact us if You are Considering a Members Voluntary Liquidation

If you are considering a Members Voluntary Liquidation for your company, please contact our insolvency practitioners or call them on 0208 088 0633 for a FREE initial chat. We have offices in central London, Brentwood in Essex, Salisbury and the Cotswolds.

Comments are closed.