Compulsory Liquidation is the legal procedure by which a Liquidator is appointed by Order of Court to wind-up a limited company.
The process is usually set in motion by a creditor such as HMRC when a company has failed to pay debts. Such a situation is likely to be traumatic, but we will support you throughout and have substantial experience to put at your disposal.
Should you receive a Winding-up-Petition (WUP), this must not be ignored and you should immediately seek advice from an Insolvency Practitioner. If granted, a Winding Up Order will stop your company from trading and the business will be investigated by the Official Receiver.
In most circumstances, the company’s bank account will be frozen as soon as the bank becomes aware of the WUP.
The Official Receiver will then decide whether to call a meeting of creditors to consider the appointment of a Liquidator. The company’s assets, including book debts, will be realised, and the proceeds used to fund the cost of the liquidation. Any excess funds would be available as a dividend to creditors, payable by order of priority.