New enquiry – Call David or Dan on 0808 1961496 or click on their name to email them a question

What are the five key tax hurdles of an Members Voluntary Liquidation?

A Members Voluntary Liquidation is used to save tax and make a distribution out of a company as capital (10% tax) rather than income (up to 45% tax).

There are a few important tests to make sure the shareholders qualify for Entrepreneurs Relief so that they qualify for the 10% capital gains tax. These are:

  1. They own at least 5% of the ordinary voting shares.
  2. They are a director.
  3. They have owned the shares for 12 months.
  4. The company actually carried out a trade.
  5. Finally the company must be wound up within 36 months of the date trading ended.

Once the shareholders are at that stage they should find an experienced and qualified Licensed Insolvency Practitioner and obtain a fixed fee quote to wind up the business as a Members Voluntary Liquidation.

From the date of the first enquiry usually it takes about 7 days to place the company into liquidation (if the shareholders are ready to proceed) and then another 7 days to pay out the majority of the funds. There is then a period of usually 3 to 6 months before the company can be finally dissolved.

If you would like to find out more about MVL’s or ask for a fee quote please contact me. Read more: What is involved in a Members Voluntary liquidation?

More in this section

With 25 years' experience of dealing with insolvency
we know its important for us to put you first.
Find out how we
can help you
.

Latest from Twitter Latest from Twitter

Sorry...

We can't load in our latest Tweet from Twitter right now
Please check back later or visit Twitter


Connect with us on LinkedIn Connect


Receive our email newsletter

Email Newsletter

Enter your details to receive regular updates from Kirks.

Don't worry, we don't use your details for any other purposes so you won't receive spam from any third parties.

×

Request A Callback

Simply fill out the short form and one of our team will get back in touch with you at your convenience.

Your Name (required)

Your Email

Telephone (only if we should call you)

Best time to call

Nearest town or city?

Please email me

×