How is a Company Liquidated?
- You may have noted the “Voluntary” word used in the Methods of Liquidating section above
- Voluntary means that the company directors and shareholders start the process at a time to suit them
- A Licensed Insolvency Practitioner must act as a voluntary liquidator of a company
- A Compulsory Winding Up is started through the courts usually through enforcement action for unpaid debts
An insolvent compulsory route is the one that HMRC will follow to pursue unpaid taxes from the company. HMRC will issue a threat of company winding up and will then issue a winding up petition through the courts. This proceeds to a court hearing to put the company into compulsory winding up.