Liquidation

Liquidation

Liquidation is the purpose of liquidating a company to bring its trading to a close, often within a relatively short space of time. The reasons behind this can be varied depend upon whether the company is solvent or insolvent. The procedure can also apply to other forms of business entity such as Limited Liability Partnerships and companies limited by guarantee.

For solvent companies the drivers can be the impending retirement of the owners, the reorganisation of a group or the completion of a specific business project.
Where a company is insolvent the factors are quite different. For instance, there could be:-

  • Accumulated tax arrears outstanding to HMRC,
  • Pressure from suppliers such as trade accounts being put on “stop” or legal proceedings chasing unpaid invoices,
  • Requests from the Bank to reduce borrowings or possibly withdraw them completely,
  • A sudden material bad debt
  • The insolvency of a major customer

In some instances the closure of a business is the only option available. We understand this can be a stressful time and we will support you through the process to ensure that the affairs of the business are brought to an orderly conclusion.

In other words, the primary objectives are:-

Solvent liquidation – extracting the shareholders’ capital speedily and in a tax efficient manner,

Insolvent liquidation – relieving the severe financial pressures which have built up and preventing further trading losses.

The Quantuma team can assist with all types of liquidations and have many years’ experience covering all major industry sectors. We offer an approach based on empathy with the people affected by the winding up. The business may be a separate entity but we recognise that the effects are felt by individuals.