Cheapest Way To Liquidate a Company

If you are looking to close down your company you will probably want to find the cheapest company liquidation method.

It is important to make sure you take financial advice from a professional business advisor service in the best ways possible.

Cheap liquidations do not always mean the best value service. Hassle-free liquidations at low costs from a professional Liquidation service provider should be your chosen method. When dealing with HMRC, bounceback loans and creditors you want the best companies in the UK to shut this down properly.

Liquidating a UK business is a complex process subject to the law and various rules and regulations.

A liquidation cannot be carried out cheaply but there are cost-effective procedures.

Find out all the Cheapest Way To Liquidate a Company in the UK.

Cheap Liquidation Process

Here are some methods that allow liquidations to be done cheaper than high street prices:

• Self fund your liquidation by selling the company assets. The proceeds will then be used to pay off creditors and Insolvency Practitioners fees
• Redundancy payments from HMRC can be claimed by directors for insolvent companies to help fund the liquidation costs
• Allow a creditor to force the company into compulsory liquidation, as does not cost the director anything (an appointed liquidator for compulsory liquidation can be stressful as they will try to pursue directors for debts personally to help cover the liquidator fees)
• Dissolve the company by striking off the company register as long as it does not owe any significant monies to creditors or have any assets in value

Go Direct to a Licensed Insolvency Practitioner

The insolvency industry has many marketing companies, lead generators or packagers who initially deal with your enquiry and refer your situation to a Licensed Insolvency Practitioner.

If you go direct to IPs you eliminate the referral fees to the insolvency specialists who market to help business people in a vulnerable position, when all they want to do is rip you off!

Or business debt advisors offering to liquidate or pre-pack your business very cheaply (taking a fee), to then just refer you to an actual Licensed Insolvency Practitioners who will liquidate your company for an additional fee.

It is important to go directly to a Licensed Insolvency Practitioner because only IPs can put the company into voluntary liquidation AFTER creditors have appointed him or her.

If researching cheap cheap cheap you will probably not be finding a professional Licensed Insolvency Practitioners to do the job properly.

Hiring a hassle-free, cheap liquidation company will save you time, worry and stress.

Cheaper Dubious Practices

Here are some typical dubious practices companies try to close a company down cheaply.

Court Liquidation

A court liquidation is the winding up of a business or a partnership in the UK by a court order (a winding-up order).

This is sometimes known as a directors petition, as a petition is presented to the court by a creditor stating owed a sum of money by the company and that the company are struggling to pay.

Some courts in the UK accept this if the directors are also creditors. Other courts will reject this procedure as an abuse of the court process.

Dissolution Promises

A dissolution is striking off your business from the official Companies House register.

After dissolution, the company ceases to legally exist.

If a company has lots of debts creditors can object and HMRC will reject if taxes are not paid.

Some cheap liquidation companies promise a dissolution as a way to close your company, without advising creditors could decline.

Directors redundancy will settle the costs

If directors have paid themselves via PAYE and have an employment contract, they can receive redundancy in a liquidation.

If the director does not owe the company any money this is actually a good solution to cover the liquidation fees.

Company directors must be able to prove that they had more than just an advisory or non-executive role in the running of the business to receive statutory redundancy payments following the liquidation of a company.

Insolvency Route

Pre Pack Administration in Insolvency seems an attractive method to directors as they can buy back the business assets on the cheap and shed their debts quickly and easily.

All assets need to be assessed by an independent valuer, as it is against the law to sell assets from an insolvent company at an undervalue.

Some banks will not allow a Pre Pack Administration sale to the directors who owned the previous company.

It is a powerful rescue tool in the correct circumstances.

If the business advisors have not at least talked to you about a Company Voluntary Arrangement debt solution then they have not given you all the options and the advice is flawed.

Average Cost Of Company Liquidation

It costs between £2,500 and £6,500 to liquidate a company.

This cost is based on the averages but it can be more or less depending on the unique situation.

Company liquidations must be carried out by a UK licensed insolvency practitioner and follow a stringent insolvency process.

Cost Benefits Of Liquidation To Your Business

Liquidation has the following cost benefits for your company:

• Existing debts are written off
• Legal action is stopped (saving additional court charges)
• Leases can be cancelled

Employees will also be able to make a claim for any unpaid salary or redundancy pay from the government fund.

Research The Best Companies

Research the best companies to help you liquidate your company.

Ensure that the firm you are dealing with is a Licensed Insolvency Practitioner.

The regulators are the following:

1. Insolvency Practitioners Association (IPA)
2. Institute of Chartered Accountants in England & Wales (ICAEW)
3. Institute of Chartered Accountants in Ireland (ICAI)
4. Institute of Chartered Accountants of Scotland (ICAS)
5. Association of Chartered Certified Accountants (ACCA)
6. Institute of Certified Public Accountants in Ireland (IFAC)
7. The Law Society
8. Law Society of Northern Ireland
9. Law Society of Scotland

The Insolvency Act 1986 and Enterprise and Regulatory Reform (BERR) also authorise UK IPs.

List of Best Companies for Closing Businesses

We have researched and created lists of the best companies for each business debt solution:

• Best Creditors Voluntary Liquidation CVL Companies
• Best Company Voluntary Arrangement Companies

Summary

It is natural to search for the Cheapest Way To Liquidate a Company but you do get what you pay for.

Ensure the Licensed Insolvency Practitioner has a good track record.

Here at best companies we research and rate all the UK IPs from testimonials and case studies to list the best Insolvency Practitioners.

You can still be a member of the Institute of Chartered accountants and not actually be licensed to be an insolvency practitioner.

Business to business selling is not governed by the same strength of regulation as business to consumer selling and there is no Business Protection Act just a Consumer Protection Act 1987.

If you sign a contract then you are unlikely to be able to get out of it easily. It is very much if you are a business then you need to do your own research.

Lowest costs and cheapest prices are not always the best value for money so research to a most economical way to close down your company from a fully professional business.