Liquidation queries.

[MR-B]

Hi Guys.

Please excuse me if this is the wrong sub forum hopefully a moderator can place it if so.

Unfortunately im in the process of liquidating a business something i never thought i would have to do but here i am, i closed the company in feb 2020 and the case is still ongoing however iv almost reached an agreement with the liquidators and have discussed a payment plan for an overdrawn directors loan account.

However after speaking to someone in a similar position i have some issues and im not sure were to turn so wondered if someone here could help.

In the last year of trading i put quite a lot of my own money into the company however it was said that i have an over drawn DLA.

When id Asked the liquidators should i submit my books for 2020 they said not to, however i have all my paperwork here ready to submit but was advised not too.

Im sumising that by submitting my books along with personal bank statements this may clear my overdrawn DLA because as far as im aware there's a near 2 year void with no record of what was in or out the company and this can all be cleared up simply by submitting a year end.

The liquidators are also asking me to have my home valued when i asked why this was they said it was on the basis of affordability for the repayment plan, however iv already submitted a monthly income and expenditure sheet, asking for a house value and any equity it has seems to be beyond the point of affordability to me?


If anyone can help or shed some light it would be greatly appreciated.

MR-B

[echat11]

des8 Can you please take a look and advise many thanks.

[EnglandPi]

I assume the liquidators are insolvency practitioners who get paid out of the proceeds of the companies assets which is why they are going after your house without seeing your books.

You should submit (a copy) of your books to the insolvency service with a covering letter.

https://www.gov.uk/get-help-insolvency-service

[Missimaxo]

The Insolvency service won't be interested if it's a voluntary liquidation unless they later investigate your conduct as a director. I presume if its a CVL you have agreed an upfront fee to pay the liquidator, this in theory should cover their fees but they will go after any company assets to claim further fees and in theory make a payment to creditors I say in theory as on smaller cases the assets are often eaten up in their fees. The DLA is the obvious asset hence they want recovery and don't want you to recalculate the balance. After it goes into liquidation you will be asked to deliver those records to the liquidator but don't expect them to use them to reduce the balance on the DLA. I would get the records done up to cessation of trade and then renegotiate repayment off the back of that. It is also likely that they will get the company bank statements and go through them looking for transactions they can overturn. They can allege payments made to you for wages, expenses and dividends (the latter can be deemed illegal if the company was insolvent). Again if you can get an accountant to agree these expenses before liquidation you're in a better position to argue with the liquidator. Once the liquidation has gone through and you have delivered the records, again its harder to argue as they have all the evidence. It is an offence not to deliver the records.

They can chase the DLA and anything else they go for aggressively which is why they're asking about your house.

Your alternative would be to not do a voluntary liquidation and wait to see if a creditor such as hmrc will put up into compulsory liquidation. Then the official receiver becomes liquidator but again it would still be better to have formal accounts to cessation of trade. The advantage of this is no upfront cost to you. Disadvantage is you may wait a long time.

[echat11]

It might be an idea to get a specialist firm with a fixed fee to handle your side of things, if they are trying 'under hand' tactics, house valuation etc it's because they are talking to a 'layman' in some respects.