| A Members’ Voluntary Liquidation (MVL) is a formal process used to wind up a solvent company and distribute the remaining assets to shareholders in an orderly and tax-efficient manner.
An MVL is typically used where a company has reached the end of its useful life, the shareholders wish to retire or move on, or a group structure is being simplified. Unlike an insolvent liquidation, an MVL is only available where the directors are satisfied that the company can pay its debts in full, together with any interest and costs, within the required statutory period. The process begins with the directors making a formal declaration of solvency. Once approved by the shareholders, a liquidator is appointed to take control of the company, settle all outstanding liabilities, realise any remaining assets and distribute the surplus funds to shareholders. When the process is complete, the company is formally dissolved. MVLs can be an effective and structured way to close a company while ensuring compliance with legal requirements and delivering an efficient outcome for shareholders. |
We can assist with:
- Advising on whether an MVL is the appropriate closure option
- Guiding directors through the declaration of solvency process
- Managing the appointment of the liquidator and statutory filings
- Liaising with accountants, tax advisers and legal advisers
- Realising assets and settling outstanding liabilities
- Making distributions to shareholders in an orderly and efficient manner
- Bringing the company to a formal conclusion with minimal disruption
Why use an MVL?
- Formal and orderly closure of a solvent company
- Efficient distribution of surplus assets to shareholders
- Clear legal process with independent oversight
- Appropriate where owners are retiring, restructuring or winding down
- Helps ensure outstanding matters are dealt with properly before dissolution