Members’ voluntary liquidation

A members' voluntary liquidation (MVL) can only be used for a solvent company, and is under the control of the shareholders, who appoint the liquidator.

Why close down a solvent company? Probably for one of two reasons – either the proprietors wish to unlock their capital and retire, or a group of companies may wish to close down a subsidiary, which has outlived its usefulness and only exists on paper.

We are regularly appointed over subsidiaries of a group of companies who are keen to reduce the administrative and financial burden of dormant, non-trading subsidiaries.

We have also been appointed on a number of occasions to assist in complex tax restructuring schemes under section 110 of the Insolvency Act 1986. This involves working with the directors and shareholders of the company and their legal advisors to ensure correct implementation of a scheme of reconstruction and timely re-distribution of assets to shareholders in order to ensure compliance with the tax approved scheme.