Creditors Voluntary Liquidation (CVL)

When a business has no money or valuable assets to pay off its debts and has no feasible way to continue to trading then a Creditors Voluntary Liquidation may be necessary. In a Creditors Voluntary Liquidation your business is brought to an end and any assets turned into money to be used to pay off your creditors.

Creditors Voluntary Liquidation (CVL) is the most common form of company liquidation.

Creditors Voluntary Liquidation is appropriate when:- –

• the business is insolvent
• the company is not viable even if restructured
• the market for the company’s services or products has declined
• it is used as part of the restructuring of a group

The Creditors Voluntary Liquidation process begins with company directors agreeing that the business can’t continue to trade and so must be placed into liquidation. An insolvency practitioner is then appointed by the business to take care of the liquidation process and paperwork. Meetings will be arranged to resolve issues with shareholders and creditors.

Advantages of Creditors Voluntary Liquidation include –

• the appointment of a liquidator may minimise the directors exposure in respect to wrongful trading action
• immediately enables creditors to recover the VAT element of the money owed
• creditors interests and returns will be maximised
• the CVL can put an end to stress and uncertainty

Creditors Voluntary Liquidation is really the last option for a struggling business. It should only be used when the business has ceased to be viable and there is no longer any realistic prospect for carrying on with the company.

CVL Advice and Information

As part of one of the UK’s leading finance and debt advisors we can provide a wide range of specialist accounting, financial and insolvency advice for your business. We can liaise with your accountants, bankers and creditors as necessary to ensure that we provide the most appropriate solution for you and your business whether that is a Company Voluntary Arrangement, Members Voluntary Liquidation or any other alternative.

If you would like further information, without obligation, on the many options available to you then call us free today on 0800 043 50 43 or complete our enquiry form and we will ring you back at a tiem convenient to you.