Members Voluntary Liquidation
A Members' Voluntary Liquidation (MVL) is a formal process designed to efficiently close a solvent company, allowing shareholders to extract accumulated capital in a tax-effective manner.
When to Consider an MVL
An MVL may be appropriate in various scenarios, including:
Director Retirement: When company directors or shareholders decide to retire and wish to distribute the company's assets.
Corporate Restructuring: During the reorganization of a group of companies following a merger or acquisition.
Cessation of Business Operations: If directors or shareholders choose to close the company and withdraw their investments
The MVL Process
The MVL procedure involves several key steps:
Declaration of Solvency: Directors must sign a declaration affirming the company's ability to pay all debts, including interest, within 12 months.
Shareholder Resolution: A resolution to liquidate must be passed by at least 75% of shareholders (by value).
Appointment of a Liquidator: A licensed insolvency practitioner is appointed to oversee the liquidation process.
Asset Realization and Distribution: The liquidator sells company assets and distributes the proceeds to shareholders after settling any outstanding liabilities.
Advantages of an MVL
Opting for an MVL offers several benefits:
Tax Efficiency: Distributions to shareholders may qualify for Business Asset Disposal Relief, reducing Capital Gains Tax liability.
Structured Wind-Down: Provides a formal and orderly method to close a solvent company.
Creditor Assurance: Ensures all creditors are paid in full before asset distribution to shareholders.
How Westgates Restructuring Can Assist
At Westgates Restructuring, we specialize in guiding companies through the Members' Voluntary Liquidation process. Our experienced team ensures a swift, cost-effective, and compliant closure of your solvent company, tailored to your unique circumstances.
Contact Us for Expert MVL Guidance
If you're considering an MVL, timely action is crucial. Contact Westgates Restructuring today for contact us now for a free initial consultation to explore the most efficient path to close your company and distribute its assets.