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Striking off of a solvent of company

A director that has a very solvent company with a large bank balance that has now ceased trading wants to strike it off. In order to obtain entrepreneurs relief, can he apply for the disolution of the company via form DS01or does he need to go through a members voluntary liquidation. 

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12th Jan 2019 13:01

What's "large"?

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12th Jan 2019 13:07

Surely, the "large" bank balance is only one element of the enquiry?
What about other material facts?
It's often like pulling teeth on here, trying to glean information.

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to Chris.Mann
12th Jan 2019 15:33

Bank account has 600k in cash. Directors loan account is a credit balance by 30k. All other liabilities now cleared. Company ceased trading some six months ago.

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to johnsavva1
12th Jan 2019 21:16

The cut off point is £25,000 so client will need a liquidator if he wants to pay CGT rather than income tax at the dividend rates.

He might usefully take repayment of his loan before approaching the liquidator.

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13th Jan 2019 15:02

Given the net value of this business (around £570,000) my own view is that the dissolution, or otherwise, needs to be approached with a great deal of consideration and planning, well before a final decision is taken to formally liquidate the company.
Anything less, in my opinion, could be deemed negligent.

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13th Jan 2019 20:00

Hopefully the client is genuinely retiring or going into employment, otherwise he needs to be aware of the anti phoenixing TAAR.

I only say this as I have a client with large cash reserves, who recently told me he wanted to wind up the company. During further discussion, it transpired that his intention was to extract the cash at 10% CGT and then continue the business via a new company.

Needless to say, he soon changed his mind!

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to Manchester_man
13th Jan 2019 22:57

But his plan made no sense anyway. Why pay even 1% in tax voluntarily?

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14th Jan 2019 10:46

He needs to go through the MVL.

He will need an Insolvency Practitioner to do this but the tax savings on the entrepreneurs relief will by far outrank the costs of the MVL!

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14th Jan 2019 10:47

Just to add that the DLA can also be dealt with by the Lqr.

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to Insolvency Practitioner
14th Jan 2019 11:47

Quote:

Just to add that the DLA can also be dealt with by the Lqr.

Yes of course it can, but my point was that it could be dealt with by the company itself more quickly and cheaply than by the liquidator.

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