When is the Right Time to Liquidate a Company?
For a Solvent company (can pay its debts and has cash or assets remaining)
- Tax is often a big factor in when it is time to liquidate
- Which tax year does a personal capital gain fall into?
- Is a budget review due that may affect tax rules for the future?
- What other personal capital gains fall within the relevant tax year?
- Is there a time restriction on the application of Entrepreneurs’ Relief (a personal tax relief)?
- Are you starting a new full-time role and won’t need your company?
- Has your business just been sold?
- Are you considering retiring from your business?
For an Insolvent company (can’t pay its debts and owes more than it owes)
- A winding up petition is being threatened or has been presented against the company
- The outcome of a court case is expected to go against a company, and it can’t pay the likely award
- The business of the company is no longer workable
- A company will not be able to pay the wages for its staff
- A landlord is going to act against the company
- Action is being taken by those owed money by the company to recover money
- A business has had to cease suddenly due to unexpected circumstances
The above are some example. Every situation is different. We will need to understand those factors to be best able to help you.