What is a Members’ Voluntary Liquidation?
A Members’ Voluntary Liquidation (MVL), also called a solvent liquidation, is a formal way to wind up a company that can pay its debts in full. A licensed insolvency practitioner is appointed as liquidator to settle liabilities, realise any remaining assets and distribute the surplus to shareholders.
Directors must be satisfied that the company can pay its debts, with interest, within 12 months of the start of the winding up. An MVL can suit retiring owners, a completed project, group simplification or a company with retained profits that is no longer needed.
It is a solvent procedure. If the company cannot meet this test, a Creditors’ Voluntary Liquidation (CVL) or a rescue option may be more appropriate.
Is an MVL right for your company?
Before choosing an MVL, check the company’s assets, liabilities, tax position and shareholder plans. We will explain the practical and tax implications before you decide.
An MVL may be appropriate
The company is solvent, ready to close and has funds or assets to return to shareholders after all creditors and costs are covered.
Strike-off may be simpler
For some solvent companies with straightforward affairs and modest remaining funds, company dissolution may be a suitable alternative. It has different rules and tax consequences.
If solvency is uncertain
Do not sign a declaration of solvency without a full review. Speak to Molly about the options, including CVL, if debts cannot be settled in full.
Understanding a Members’ Voluntary Liquidation
Watch our video for an introduction to MVLs and the questions to consider when closing a solvent company.
If you are thinking about winding up your company, Molly can help you review the position, understand the process and decide on the next step.
Download our free MVL guide →The MVL process, step by step
Our team prepares the formal paperwork and keeps you informed at each stage.
Review the company
We discuss assets, liabilities, tax, shareholders and whether an MVL is suitable.
Declare solvency
A majority of directors make a statutory declaration, supported by a statement of assets and liabilities.
Pass the resolution
Shareholders pass a special resolution to wind up the company and appoint a licensed liquidator.
Settle affairs
The liquidator deals with assets, creditors, tax and statutory notices.
Distribute surplus
Once liabilities and an appropriate reserve are covered, remaining value is distributed to shareholders.
Complete the closure
The liquidator completes the required reporting and the company is ultimately dissolved.
MVL tax treatment and costs
Distributions in an MVL are generally treated as capital rather than dividends, but each shareholder’s tax depends on their circumstances. Business Asset Disposal Relief (formerly Entrepreneurs’ Relief) may reduce Capital Gains Tax for those who meet its conditions; it does not apply automatically. Other anti-avoidance rules can affect the treatment, especially if a similar trade is restarted. Take tailored advice from your accountant or tax adviser before proceeding.
We provide a clear indicative MVL quote below and explain the expected costs and steps before you commit. The amount available to distribute depends on outstanding liabilities, tax, expenses and any necessary reserves.
Check current Business Asset Disposal Relief guidance on GOV.UK →
Direct support from Molly Monks F.I.P.A.
Molly is Parker Walsh’s founder and in-house Licensed Insolvency Practitioner. With more than 20 years’ experience, she works closely with directors from the first discussion to the final stages of a solvent liquidation.
You have direct access to your liquidator, supported by a small, friendly team. We handle the procedure in-house and explain the fees clearly.
Arrange a free, confidential chatGet an instant indicative MVL quote
Answer a few questions about your solvent company. Molly will personally review your enquiry and can talk through your options.
Members Voluntary Liquidation (MVL) Quote Calculator
Complete the form below to get an instant indicative quote for your MVL.
Useful MVL articles and guides
Explore the details before you decide how to close your company.
Free guide to MVLs
The declaration of solvency, shareholder decision, distributions and final dissolution. Read the guide →
MVL process explained
See the practical stages of a solvent liquidation. Read article →
Benefits of an MVL
Understand the reasons owners choose a formal solvent closure. Read article →
Tax points to consider
Review the questions to discuss with your tax adviser. Read article →
What to prepare
Find out which company information helps us get started. Read article →
MVL FAQs
What is the difference between an MVL and a CVL?
An MVL is for a solvent company that can pay its debts in full within 12 months. A CVL is for an insolvent company. If you are unsure, we can review the position with you.
How long does an MVL take?
Timing depends on the company’s assets, outstanding tax matters and creditor position. Some distributions may be made before the liquidation is fully complete; we will explain likely timescales for your circumstances.
Does every shareholder qualify for Business Asset Disposal Relief?
No. Eligibility depends on the shareholder and the company meeting the relevant conditions. Please check the current rules with your tax adviser.
Can I close a company by striking it off instead?
Possibly, if it meets the strike-off conditions. The right route depends on the value to distribute, potential liabilities and tax treatment. We can help you compare the options.
Close your company with a clear plan
Talk directly to Molly about your company’s position and what an MVL would involve. Initial advice is free and confidential.
