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Ed Turner
Ed Turner,
Category: Law
Satisfied Customers: 2738
Experience:  Director and Consultant Solicitor (Self-Employed) at Ed Turner LLB Limited
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Closing down a company (England & Wales) & return of

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Dear Sir / Madam,Closing down a company (England & Wales) & return of funds....The situation is as follows:A couple own a company 50:50 as shareholders & are co-Directors.The company is being closed down as it is no longer needed.There is an overdrawn Directors’ account, which will be repaid. (A large 5 figure sum.)Please can you advise what happens to:
a. The cash that is sitting in the company's bank account?
b. The cash that will be in the company's bank account once the overdrawn Directors’ account has been repaid?I assume all cash gets returned to the couple as the sole (50:50) shareholders?I am keen to do this in a timely fashion to avoid the bank account being closed prematurely and funds going to the Duchy of Cornwall instead!
(This used to be the case - i assume it still is.)
Not sure how I ensure this....Please would you confirm my understanding is correct?Also, how is that returned cash treated for income purposes or is it simply deemed to be return of capital invested?Many thanks.

Hello. I am Ed, a Solicitor qualified in England and Wales with over a decade’s experience in the legal profession advising clients.

I specialise in Commercial Contracts, Business Transactions, Employment, Dispute Resolution, Personal Injury and Road Traffic Law and shall be reviewing your legal problem today.

I shall be delighted to talk with you by phone to discuss your issue in greater detail if you accept the site’s automatic offer of a Premium Service Phone Call.

You and your co-director and shareholder need to place your company in a Members’ Voluntary Liquidation (“MVL”).

An MVL is a solvent liquidation that facilitates the closure or restructure of a company’s business.    Shareholders of a solvent company who choose this route will approve a resolution to voluntarily wind-up the company and appoint a liquidator to realise the assets of the business.   It provides for all creditors to be paid in full (together with interest) within 12 months and for the distribution of surplus assets to its shareholders.

I suggest that you instruct your company accountants, solicitors and an insolvency practitioner to guide you through the MVL process.

I hope this is a satisfactory initial reply to your question and you understand my recommendations. Please revert to me if you do not understand anything and require clarification of my answer and I shall be delighted to assist.

I can also offer a Premium Service Consultation for an additional fee if you need detailed and bespoke legal advice. If you accept, I will pass you my direct email address and phone number. I can review any relevant documentation and consult with you by telephone for around 20 minutes. This will give you a clearer picture of your legal position and your potential options for progressing the matter to the next stage.

Kind regards

LawyerEd

I hope that you are satisfied with my reply and wish you all the very best in resolving this matter.

If you require further legal advice from me, please create a new text thread on the portal and start it with @EdTurner. I will be notified of your request and prioritise it.

Kind regards

LawyerEd

Customer: replied 10 days ago.
Hi Ed, That's very helpful - thank you very much.
I shall contact the relevant people as advised.
Thanks again.

Great, best of luck with it!   :)

Customer: replied 10 days ago.
Thanks!

I will close this thread.

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