A company that has completed its purpose and is solvent may be wound down by way of a Members’ Voluntary Liquidation.
What is a key advantage of a Members’ Voluntary Liquidation?
This can be a tax efficient way for shareholders’ to extract funds from a company on cessation of trade as a capital gain on shareholders’ funds will be subject to Capital Gains Tax.
Where such funds are taken out as salary or dividend pre-liquidation, these monies would have been taxed at the shareholders marginal income tax rates.
It is important to obtain tax planning advice prior to any cessation of trade or liquidation to ensure that tax costs can be minimised and the return to shareholders maximised.
How can Baker Tilly assist?
- Act as the company’s nominee as Liquidator
- Prepare the Statement of Affairs
- Provide tax advice in advance of commencing the process