Cheap Low-Cost Alternative to Insolvent Liquidation - Affordable Low Fixed Prices & Fees for Insolvent Companies
Can't afford a liquidation? Need a cheap low-cost insolvency as a cheap alternative to liquidation? Consider Dissolution
Costs of liquidating a Company
If you can't afford a liquidation of your company because of the lack of money available to pay liquidators costs and fees then consider this cheaper and affordable low-cost alternative to liquidation, which can provide a cheap price low-fixed cost instead of an unknown level of liquidators fees by using a dissolution process under Section 1003 of The Companies Act 2006.
We call it the "I can't afford a liquidation" or "Cheap alternative to Liquidation" process and that service can be delivered to your company's creditors by Purnells Licensed Insolvency Practitioners. The process is based on making the benefits of using Sections 1003 to 1008 of the Companies Act 2006 (formerly Section 652 of The Companies Act 1985) available to your limited company and is officially called a Strike of Application, or a Section 1003 Application.
This process is used to have a company struck from the Companies House Register and dissolved. The procedure also has the benefit of not being a formal insolvency procedure and is often called a cheap alternative to liquidation but is not a formal liquidation under The Insolvency Act 1986.
The "I can't afford a liquidation" or "Cheap alternative to Liquidation" process can be used if your company is insolvent and has minimal assets, and you want it to be dissolved and removed from Companies House.
The cost benefit to you and your company
Generally - a lower and certain fixed price for this alternative to liquidation.
The minimum price for a creditors voluntary liquidation is often quoted by others as being from £2,500 plus VAT when what they might really mean is that that quoted cost figure is merely the sign on fee - and more charges are payable later out of asset realisations in the following liquidation. By contrast Purnells will, in most instances, if a liquidation is needed, charge no upfront fee thus making it a free liquidation as far as your personal pocket is concerned.
There are three alternative ways in which you could progress the "I can't afford a liquidation" or "Cheap alternative to Liquidation" process:
- Firstly the process would only cost £8-£10 if you do all the work yourself in order to Strike Off the Company using a DS01 Form.
- Secondly and alternatively for a small fee we can send you a work plan, a work check list, standard letters and forms and a copy of the relevant Sections of the Companies Act 2006. (Sections 1003 to 1008) to enable you to progress the procedure yourself in its entirety with the comfort of knowing that you are guided by Licensed Insolvency Practitioners and that all the legal requirements are satisfied.
- Thirdly you could hand over the entire process to us for a low fixed fee. That one time fixed fee is at least 25% less than the lowest liquidators fee that you can find advertised on the internet - Guaranteed. This can make it the cheapest insolvency process your company can utilise.
The "I can't afford a liquidation" or "Cheap alternative to Liquidation" process - If I take the third option and instruct Purnells Licensed Insolvency Practitioners what do they actually do for me and my company? - How is creditor pressure relieved?
We meet with you in person or by way of an hour or two's long telephone conversation. During that discussion we complete an enquiry pack so as to fully understand your company's financial position. We also examine the situation as to any personal guarantees given by you to company creditors - We also give advice on that key matter.
At the meeting we address your concerns and questions. We don't jump to conclusions - instead we examine all the available options and discuss the pros and cons of each option with you to see if a Strike Off Application is a viable option. Once we have both confirmed that the "I can't afford a liquidation" or "Cheap alternative to Liquidation" process is right for your company, we then send you an e-mail requesting a "shopping list" of information. That is information that is needed to move to the second stage of the process.
Once that requested information is received back from you we then prepare a full pack of information for creditors. The pack includes:
- a statement of affairs,
- a schedule of secured, unsecured and preferential creditors
- a list of employees and their claims
- statutory information
- a charges register (taken from information filed at Companies House)
- a company history to explain the background to the company's financial difficulties.
We then write to all the creditors and explain the financial position to them. We explain that if they issue a winding up petition against the company then they would incur abortive and irrecoverable costs of an estimated £3,000 to £4,000 on top of the amount they have already lost.
However we positively invite the creditors to petition for winding up of your company and even say that "we would be grateful if they would petition" - But in 99% of cases the creditors do not wish to throw good money after bad - particularly after they have had the financial position fully explained to them.
To satisfy the requirements of Section 1006 of the Companies Act 2006 we also send the pack to all shareholders, directors, employees and to trustees of any pension fund.
We write to the Registrar of Companies with the appropriate form and also copy to the registrar the letter and pack of information that was sent to all creditors.
We ensure that you have satisfied your duties as a director in connection with every paragraph of the many relevant pages of Companies Act requirements to ensure that the company is dissolved properly.
Further benefits for you
With a redirection of post then put in place, all company post is delivered to one of Purnells' offices. That results in Purnells taking over all the written pressure from your company's creditors, their solicitors, bailiffs, HMRC, Inland Revenue, VAT, PAYE and employees. In other words, Purnells take the heat and you are relieved of stress and worry. You can get on with your life and concentrate on the positive aspects of any new business that you might have started or intend to start. (We can also advise on phoenix, or restart companies, using a Creditors Voluntary Liquidation, and prepacks in an Administration, if that is advice you need.)
The registered office of your company is also changed at Companies House to Purnells' address. In consequence, you do not get bothered by any legal or Companies House documents that are later served on the company. Instead those documents are sent directly to Purnells and we reply to them on the same day.
We review your company file each month after sending out the information pack to the creditors and then update you by email. Our monthly update to you tells you the then forecast time given by Companies House as to when they expect that your company will be struck off and dissolved.
Normally after three to eight months of sending out the creditors pack the company is struck from the register at Companies House and then ceases to exist and the dissolution process is complete.
In the interim period you have not had to face a creditors meeting and we have taken any postal and telephone pressure off you in the limbo period leading up to strike off.
You have addressed your statutory duty (through us) of informing your creditors of the financial position and as you have also reported the matter to the Registrar of Companies you can then not later be personally fined by the Registrar for any later failure to deliver accounts and annual returns.
As the process is not a formal liquidation no "conduct report" on the directors is sent to the Directors Disqualification Unit and no investigation is undertaken into the company's affairs.
If you instruct Purnells then we can be paid by a personal credit card, personal cheque or out of the realisation of any assets (by definition of small value) of your company. Alternatively, for £10 you can do all the work yourself. In any event we work on a fixed fee basis so that you know where you are.
If you can't afford to liquidate your company and want a cheaper more affordable alternative to liquidation then the "I can't afford a liquidation" or "Cheap alternative to Liquidation" process may be the best option for you. If you wish to avoid the costs of formally liquidating your company and instead wish to use the cheapest alternative to liquidation then please give us a call on 01326 340579 and we will be more than happy to provide a free meeting to discuss whether a low-cost alternative to liquidation is available to your company.
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Fill in the form and we'll give you a call as soon as we can to discuss your needs in a free initial consultation with a Licensed Insolvency Practitioner. Alternatively give us a call on 01326 340579 if there is an urgency to your needs.