Liquidation is the formal legal process that will end the life of a limited company. Voluntary liquidation can be initiated by directors and shareholders, and if the company is insolvent there will also be a meeting of creditors to agree the liquidator’s appointment.
In the initial stages liquidation does not close the company; it will continue to exist in a protected state while the appointed liquidator winds up its business affairs, collect in its assets and settles its obligations and liabilities. In some cases this can give directors, or other interested parties, the chance to buy back the company assets.
The appointment of a liquidator brings to an end the obligations of directors, who can then move on in other directions. They usually have no further involvement in the liquidation or the company from then on.
Once the liquidation has been completed the company is formally dissolved and will be removed from the register at Companies House. It then ceases to exist.
Straightforward company liquidation procedures usually take around six to eight months to complete.