Striking off Your Company
My latest article is regarding the rise in accountants poorly advising their clients on how to close down their company when there are outstanding debts. A large proportion of our phoenix liquidation or close down liquidation cases nowadays have at some point tried to strike off their company first (even though there are outstanding creditors) in order to save the costs of liquidation. This not only gets rejected out of hand and gets registered at companies house as a failed attempt to close it down incorrectly but it also is a black mark on the name of the directors of the Company despite it usually having been done as a result of poor advice from the Company’s accountant. So don’t make the same mistake, and make sure that if you have a client that has outstanding debts, you advise them to appropriately close down their business by way of a Liquidation or other insolvency process thereby avoiding any conduct issues later on.
HMRC Reject Strike off Proposals
Our experience of strike offs is that more often than not, they are rejected by HMRC due to outstanding taxes but rejections can come from anywhere as long as they can evidence sums due to them.
There are added benefits of closing a company down through a liquidation, as once the liquidation is concluded and the Company dissolved from the register, no person can apply to re-instate the company to the register after 3 years from dissolution. Whereas, if it has been closed by way of a strike off, the company can be re-instated to the register anytime after 10 years from dissolution (meaning an end to any contingent claims or disputed creditor issues never really occurs for many years).
It is also worth stating that Liquidations are so cheap nowardays that it is worth paying a little extra to a licensed insolvency practitioner to do your phoenix or close down liquidation for the added peace of mind you receive.
Alternatively if you wish to discuss strike off or our liquidation services or have any general insolvency queries please feel free to contact us on 0800 612 6197.