A guide, not advice. This explains how things generally work. A licensed insolvency practitioner will tell you what applies to your company or to you.
What Does Liquidation Cost?
The cost of liquidating a limited company depends on the type of liquidation, the complexity of the company's affairs, and the value of its assets.
Creditors' Voluntary Liquidation (CVL)
A CVL is the standard route for closing an insolvent company. Typical fees start from around £3,000 to £5,000 plus VAT. Where the company has assets (stock, equipment, book debts), the liquidator's fees are usually paid from the proceeds of those assets - so directors do not need to fund the process personally.
Where a company has no assets, directors generally need to fund the liquidation themselves, though the cost is often offset by director redundancy pay, which most qualifying directors are entitled to claim.
Members' Voluntary Liquidation (MVL)
An MVL is used to close a solvent company. Fees typically start from £2,000 to £4,000 plus VAT, plus disbursements. Because the company is solvent, the cost is paid from the company's own funds, and the tax savings achieved through capital treatment usually far outweigh the fees.
What's Included in the Fee?
A reputable liquidator's fee will typically cover:
- Initial advice and assessment of the company's position
- Preparing and filing the necessary legal documentation
- Convening and chairing meetings of members and creditors
- Realising the company's assets
- Agreeing creditors' claims and making distributions
- Dealing with the company's dissolution
- Statutory investigations and reports to creditors
How to Fund Liquidation With No Assets
If your company has no assets, there are still options:
- Director redundancy - Most directors who have been employed by the company for two or more years can claim redundancy, often worth several thousand pounds, which can fund the liquidation.
- Personal funding - Some directors choose to pay the fee personally to bring matters to a clean close.
- Asset valuation - Even modest assets can reduce the amount directors must pay.
Beware of Hidden Costs
Some firms quote a low headline fee and then add charges for disbursements, asset realisation, or investigations. We provide a clear, written breakdown of all costs before you commit - no surprises.
Speak to a Licensed IP
For a transparent, no-obligation quote tailored to your company's circumstances, call our Manchester team.