If you’re company is entering liquidation, you want to know how long the process usually takes.
In this article we’ll cover the usual timeframes, breaking down each stage of the liquidation, and explaining what happens when the process is complete.
How Long Does Company Liquidation Take?
It usually takes between 6-24 months to complete the liquidation process , depending on the size of the company.
The timeframe for liquidating a company varies widely depending on the state of the business, its size and the complexity of its assets.
Although directors typically want liquidation to happen as quickly as possible, the minutiae of closing down a functioning business can take many months, even years to complete.
As a director, the more you cooperate with the liquidator, supplying information and paperwork promptly, the faster the process will go.
For creditors (including employees) waiting in line to be paid, the liquidator will be your main point of contact, not the directors, and you should communicate with them about the timeframes to getting paid.
If you’d like to talk through your specific situation, please call 0800 074 6757 or email firstname.lastname@example.org for free and confidential advice from one of our professional advisers.
Voluntary Liquidation Timeline
On average, the following timeframe applies when voluntarily liquidating a company:
- 1-2 weeks to appoint a liquidator
- 14 days to actually place the company into a voluntary liquidation.
- 1 year to complete the liquidation so that all assets have been realised and the proceeds distributed to creditors (or even longer where big companies are concerned.)
- 6-24 months to liquidate a company from start to finish.
Compulsory Liquidation Timeline
The timeline of a compulsory liquidation is as follows:
- 7 working days to respond when a creditor serves your limited company with a winding up petition
- 14 days notice is the minimum you’ll be given for the court hearing.
- 6-24 months f the petition becomes a winding up order and the company enters liquidation.
Members Voluntary Liquidation Timeline
Closing a solvent limited company via a members voluntary liquidation typically takes between six months and one year, although this will vary depending on the complexity of the business assets.
The MVL timeline is as follows:
- The process begins with a declaration of solvency, after which directors have 5 weeks to begin liquidating the company.
- A creditors meeting must happen within 14 days of the resolution to wind up being passed.
- Shareholders should receive funds within 3 months.
- Proceeds of the liquidation are typically distributed in 3-6 weeks.
- After the MVL final meeting, the liquidator sends notice to the Gazette, and the company strike off happens within 3 months, ending the process.