Advantages and disadvantages of liquidating the assets

In a compulsory liquidation the company is wound up by one of its creditors or HMRC after failing to pay a debt of more than £750.A creditors’ voluntary liquidation takes place when the directors purposefully choose to liquidate the company.

In a voluntary liquidation, these expenses, along with the cost of appointing an insolvency practitioner, are all covered by the directors.Friday 11th March, 2016 The company behind Austins, one of the oldest department store businesses in Europe, has been forced into liquidation after failing to overcome a financial crisis in recent days.Liquidation is a very useful way of wrapping up a limited company that is no longer able to trade due to its debts.Liquidation is a formal insolvency procedure in which a company is brought to an end; all of its assets are liquidated and the proceeds from the sale of assets is used to repay creditors.There are two main types of liquidations for insolvent companies– compulsory liquidation and creditor’s voluntary liquidation (CVL).

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