End of ESC C16 1/3/12.

[Greg@CapitalCity]

If we go down the liquidation route, does this circumvent the need for 'approval' by HMRC, i.e. is it guaranteed to provide company closure as we would want it?

Once a company is liquidated, all distributions made count as capital receipts in the hands of the shareholders. There is no HMRC approval required as there was with ESC C16, just the formal liquidation process that needs to be followed.

[Ruprect]

Question on liquidation: do you have to give over control of assets (ie chequebook) to the liquidator during the process? If so, isn't this a bit of a risk?

[sbakoola]

Question on liquidation: do you have to give over control of assets (ie chequebook) to the liquidator during the process? If so, isn't this a bit of a risk?

Exactly what I fear... that is not acceptable... could someone PLEASE reassure me that this won't be necessary ...?

This Government is such a pain in the a*se..

[Ruprect]

I have been quoted £2k by my accountant (he isn't the liquidator).

I wonder though: with the old ESC16, HMRC still had to 'approve' the move, and therefore, extraction of funds as capital gain was not guaranteed.

If we go down the liquidation route, does this circumvent the need for 'approval' by HMRC, i.e. is it guaranteed to provide company closure as we would want it?

Hey CM could you PM me their name? Thanks!

[ChimpMaster]

Once a company is liquidated, all distributions made count as capital receipts in the hands of the shareholders. There is no HMRC approval required as there was with ESC C16, just the formal liquidation process that needs to be followed.

Thanks Greg. So, certainly in this respect the liquidation route is better than ESC16, especially if you have a large balance in the company acccount.

Ruprect's question of control is an interesting one though.

[Nixon Williams]

Exactly what I fear... that is not acceptable... could someone PLEASE reassure me that this won't be necessary ...?

This Government is such a pain in the a*se..

If you appoint a liquidator, they will take control and administer the company assets and ensure liabilities are paid etc, any funds remaining would be distributed to the shareholders.

It is quite a simple process, but the liquidator must be independent and your accountant will not be able to do this for you, although they will probably be able to direct you to someone.

The main thing to agree is the fee up front, I envisage liquidators will attempt to charge a very large fee if they can. If someone can do it for £2000 then that sounds very good value.

Alan

[THEPUMA]

If you appoint a liquidator, they will take control and administer the company assets and ensure liabilities are paid etc, any funds remaining would be distributed to the shareholders.

It is quite a simple process, but the liquidator must be independent and your accountant will not be able to do this for you, although they will probably be able to direct you to someone.

The main thing to agree is the fee up front, I envisage liquidators will attempt to charge a very large fee if they can. If someone can do it for £2000 then that sounds very good value.

Alan

I don't believe that is correct. My understanding is that if an accountancy practice has an insolvency practioner, it can deal with MVLs on behalf of its clients. Not insolvent liquidations though.

[ChimpMaster]

<snip>
The main thing to agree is the fee up front, I envisage liquidators will attempt to charge a very large fee if they can. If someone can do it for £2000 then that sounds very good value.

Alan

Frankly I'm happy to pay 3 or 4 thousand to guarantee treatment of the funds as capital distribution. The advantage is clear for any business that has a reasonable balance in the company a/c.

HMRC have missed a trick here: they may as well have said "give us £5k and we'll waive your ESC16 through with no questions asked".

[Nixon Williams]

I don't believe that is correct. My understanding is that if an accountancy practice has an insolvency practioner, it can deal with MVLs on behalf of its clients. Not insolvent liquidations though.

Happy to stand corrected, although I doubt if this would apply to any specialist contractor accountant.

[Nixon Williams]

Frankly I'm happy to pay 3 or 4 thousand to guarantee treatment of the funds as capital distribution. The advantage is clear for any business that has a reasonable balance in the company a/c.

HMRC have missed a trick here: they may as well have said "give us £5k and we'll waive your ESC16 through with no questions asked".

If the company is liquidated, the treatment as capital of the distribution is guaranteed.