The UK Rules
'Follow the Regulations'
Company Liquidation Process

How to Liquidate a Limited Company

There are several important aspects to consider if you liquidate your limited company. See how liquidation works, be it compulsory or voluntary, and the role of a director and a liquidator.

WINDING UP A LIMITED COMPANY: There are specific procedures to follow if you choose to liquidate a company yourself.

Liquidated companies get removed, also called 'struck off', from the register at Companies House.

From then on, the company stops trading as a business and no longer employs people.

In simple terms, the business would then cease to exist. As a rule, the business assets get sold to pay off any debts when you are liquidating a company.

If there is any money left, it would go to the shareholders. But, you cannot access the company bank account without a validation order.

Shareholders must share the money before the company gets struck off the register. Otherwise, it those funds would go to the state. You would need to restore a dissolved company to claim back that money after it got removed.

What are the Different Types of Liquidation?

Note: A limited company unable to pay its debts can get forced into liquidation by its creditors.

Arranging Liquidation of a Company with Creditors

How to Liquidate a Limited Company Yourself in the United KingdomA company director can make a proposal to stop trading and get liquidated. In this case the company would get 'wound up' if either:

Getting the Shareholders' Agreement

You must get an agreement from the majority of the shareholders to wind up a company. That means calling a meeting of all the shareholders and asking them to cast a vote.

By value of shares, 75% of the shareholders must agree to the winding-up process. This is the only way to pass a company 'winding-up resolution'. Following a successful resolution, there are 3 important steps to follow:

  1. You must appoint an authorised insolvency practitioner to act as a liquidator. They will take charge of liquidating the company.
  2. Send the results of the winding-up resolution to Companies House within 15 days.
  3. Advertise the company resolution in The Gazette Official Public Record within 14 days.

Note: The role and responsibilities of a company director change after appointing a liquidator.

What does a Liquidator do?

The role of the liquidator is acting as an authorised insolvency practitioner. A liquidator is the official receiver who conducts the company liquidation process.

Once liquidators get appointed they take over the control of the business. That means when you are closing down a limited company the official receiver will:

Note: A liquidator will act for the interest of the creditors in a creditors' voluntary liquidation - not the directors.

Also in this section...

Apply to the Court: How a company director can ask the court for a compulsory liquidation order.
Directors after Liquidation: Find out what happens to directors when a liquidator gets appointed.
Shareholders' Voluntary Liquidation: MVL is a members' agreement to liquidate a solvent company.


How to Liquidate a Company Yourself in the United Kingdom