What is a Members Voluntary Liquidation (MVL)?
Winding up the affairs of a solvent company
An MVL is a process used to wind up the affairs of a solvent company, i.e. one that can pay its debts in full.
An MVL is typically used where a company has (or multiple companies have) come to the end of its useful life. For example, the business and/or assets of a company being sold leaving only a ‘shell’; or a cumbersome corporate structure requiring simplification to reduce administrative costs; or there is a desire to move assets or value within a corporate structure.
The MVL process facilitates a controlled exit allowing the shareholders or parent to extract the cash or assets in their business in a tax-effective manner. There are often substantial tax advantages in conducting an MVL as the value that will be distributed to shareholders represents a return of capital, rather than dividend income which typically attracts a higher rate.
The process also provides greater protection for directors and shareholders than a dissolution application made without following a liquidation procedure.
For more information on an MVL, we offer an initial free consultation to review the situation and make recommendations on the best way forward. If we think that an MVL is the best route forward, our specialists can support you at every step of the way through the process. For a no obligation chat, complete the form opposite, include a best time for us to call you and a Partner will be in touch.
Alternatively, book a convenient time for us to contact you