Understand the position
Clear information before you decide what to do next
Compare striking off, Members’ Voluntary Liquidation and Creditors’ Voluntary Liquidation when closing a limited company.
- Separate solvent and insolvent closure
- Deal with assets, taxes and creditors correctly
- Avoid using strike off to bypass unpaid debts
Solvent and insolvent companies use different routes
A solvent company may be struck off or use a Members’ Voluntary Liquidation. An insolvent company may require a CVL or another formal process. The balance sheet, tax position and ability to pay debts should be confirmed first.
Striking off is not a substitute for insolvency
Creditors can object to dissolution and unpaid liabilities do not disappear merely because an application is filed. Assets can also pass to the Crown if they are left in a dissolved company.
Plan the closure before trading stops
Contracts, employees, leases, customer deposits, stock, finance, tax returns and company records all need an orderly plan. Directors should also review personal guarantees and loan accounts.
Practical next steps
What to prepare now
A clearer picture helps the first conversation focus on realistic options.
- Confirm whether every liability can be paid
- List remaining assets and contracts
- Review employees, leases and tax filings
- Select the appropriate closure process
Common questions
Close Down a Limited Company FAQs
Can I strike off a company with debts?
Creditors may object and restore a dissolved company in some circumstances. An insolvent company should be reviewed for an appropriate insolvency route.
What is an MVL?
A Members’ Voluntary Liquidation is a formal process for a solvent company whose directors make the required declaration of solvency.
What happens to company assets on dissolution?
Assets still owned by a dissolved company can pass to the Crown, so they should be dealt with before closure.
This page provides general information and is not legal, tax or financial advice. The right action depends on the company’s circumstances. Formal insolvency procedures must be handled by an appropriately authorised professional.
