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Beneficial/legal shareholder

Who needs to approve a dissolution

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I have a strange situation with a client.

My client is the director and beneficial shareholder of a UK company. For some reason the legal shareholder and PSC shown on Companies House is someone else.

My client claims that the other guy is a nominee shareholder for my client. 

The two of them have fallen out and my client now wants to liquidate the company.

The question is, can he do it without the agreement (without even telling him maybe) of the legal shareholder?

 

 

 

Replies (9)

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By Paul Crowley
18th Oct 2021 11:03

Stand clear and let the client do it on his own.
My guess is that there was nothing in writing to confirm the position.

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By OldParkAcct
18th Oct 2021 11:04

If shareholder is just a nominee then Companies House will be disclosing the director as the controlling party?
If the director has not disclosed this correctly then might have difficulty in proving he is the beneficial owner.

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By David Ex
18th Oct 2021 11:13

Is this arrangement documented? If not, I’d suggest the client needs a solicitor.

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Replying to David Ex:
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By petestar1969
20th Oct 2021 15:14

Thanks, I already suggested this to him.

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paddle steamer
By DJKL
18th Oct 2021 11:34

Why would be my concern. Why this arrangement was entered into, what MLR implications might this arrangement have, who has been directing accountants, who appointed accountants, what MLR checks were done by accountants etc etc?

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ALISK
By atleastisoundknowledgable...
18th Oct 2021 13:12

I’ve seen this a fair bit with both shadow directors and shadow shareholders, thankfully no fallouts yet but …

Unless your client can provide it’s a nominee shareholder (in the courts if required), then I don’t think he has much hope.

Can he just resign and see if CoHo do it for him?

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Lisa Thomas
By Lisa Thomas
19th Oct 2021 10:23

When the client says he wants to liquidate the company are you referring to a formal liquidation process, or is that just the terminology he uses for dissolution?

If he does actually mean Liquidation, is this to be solvent or insolvent Liquidation?

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Replying to Insolvency Practitioner:
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By petestar1969
20th Oct 2021 15:27

I'm not sure, he's Italian and I believe liquidation has a slightly different meaning in Italy.

The UK company's main asset is an Italian company which is "in liquidation" even though it owns property in Italy.

Anyway, I've told him to speak to a lawyer.

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By Tax is always taxing
20th Oct 2021 15:39

Strange. Obviously PSC should still have been listed as your client (the Director) but I suspect he knows that and didn't want to disclose it for some reason, but most people wouldn't then list themselves as a director.

Is this a new client, or is this a longstanding client who has previously lied to you about what the arrangement was? If he'd previously lied I would say goodbye now, if he's new its likely that's what his previous accountant just did.

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