What is "voluntary liquidation"?


Hi, I’ve done business with a local shipping company in the south of England for years and years. Yesterday, I tried to get in touch with my contact who usually deals with my account, but instead I got some stranger on the phone who’d told me that this company had gone into voluntary liquidation. What on earth does that actually mean?



Voluntary liquidation is one of the ways in which a company can be officially closed down. An application can be made by the members or creditors of a company.

A members’ voluntary liquidation is available if your company is solvent and you wish to retire or stop running the business for any reason. A majority of the shareholders must pass a resolution to approve the closure.

A creditors’ voluntary liquidation can be proposed by the director(s) if your company is insolvent (unable to pay its debts) and at least 75% of the shareholders’ votes are cast in favour of winding up the company.

2 years ago

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