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Is an MVL right for my company?

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Is an MVL an efficient exit route for my business?


Written by Jonathan Munnery

MVLs are only suitable for solvent companies. However, if your company is solvent and has over £25,000 to distribute, and you are looking to close down the business and extract these profits, then an MVL is likely to be the best solution. The alternative way to close a solvent company is by having it struck off – or dissolved – at Companies House.

This is a much cheaper option than an MVL, but it could end up actually costing you more when you take into account how the distributions will be taxed. Taking money out of the business by way of dividends is likely to incur a higher rate of tax when compared to extracting this as a capital distribution.

However, if you have a relatively modest level of funds within the company, an MVL may not be required. You are strongly advised to discuss your options with a licensed insolvency practitioner who will be able to confirm whether an MVL will be the most cost-effective option for you and your company.

Although nobody goes into business expecting their company to fail, UK Liquidators were supportive and helpful through the whole liquidation process, and I would have no hesitation recommending them to others in the same position.
Paul Winter
|
Director
Common Liquidation Questions
Difference between an MVL and Dissolution

An MVL is a formal liquidation process which must be undertaken with a licensed insolvency practitioner.

Difference between an MVL and a CVL

MVLs and CVLs are both formal liquidation processes, however, there is a key difference.

What is a Members’ Voluntary Liquidation?

A Members’ Voluntary Liquidation – or MVL – is a formal liquidation process designed as a way for solvent companies to wind down their operations.

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