Members’ Voluntary Liquidation (MVL) Services in Scotland
If you’re looking to close a solvent limited company in a tax-efficient way, a Members’ Voluntary Liquidation (MVL) could be the ideal solution. At Henderson Loggie, we provide expert guidance to help directors maximise returns, minimise tax liabilities, and ensure a smooth and compliant company closure, for clients across Scotland and the rest of the UK.
128 MVLs
Since 2018
100+
Years of combined experience
What is a Members’ Voluntary Liquidation?
A Members’ Voluntary Liquidation (MVL) is a formal process used to close a solvent limited company. It is designed for businesses that can pay all of their debts in full, typically within 12 months.
During an MVL, an appointed insolvency practitioner liquidates the company’s assets, settles any outstanding liabilities, and distributes the remaining funds to shareholders.
This process is commonly used by directors who are:
- Retiring or stepping away from business
- Restructuring or simplifying group companies
- Closing a business that is no longer required
- Seeking a tax-efficient way to extract retained profits
Is an MVL right for your business?
An MVL may be the best option if your company:
- Is solvent (able to pay all debts in full)
- Has retained profits of £25,000 or more
- No longer serves a purpose or is being wound down
- Has shareholders looking to extract funds tax efficiently
If your company has lower retained profits, an informal strike-off may be more suitable, although it may not offer the same tax advantages. Our latest blog outlines the difference between a strike off and MVL.
At Henderson Loggie, we support businesses across Scotland and the rest of the UK to assess your circumstances and explain whether an MVL is the most beneficial route for you.
The MVL Process Explained
The MVL process, or Members’ Voluntary Liquidation, follows a structured legal procedure.
1. Declaration of Solvency
Directors formally confirm the company can meet all liabilities as part of a Members’ Voluntary Liquidation.
2. Shareholder Resolution
Shareholders pass a resolution to wind up the company through the process.
3. Appointment of Insolvency Practitioner
A licensed insolvency practitioner is appointed as the liquidator.
4. Asset Realisation
Company assets are sold or distributed.
5. Settlement of Liabilities
All creditors are paid in full.
6. Distribution to Shareholders
Remaining funds are distributed as capital.
7. Company Dissolution
The company is formally removed from the Companies House register after completion of the Members’ Voluntary Liquidation.
We have licenced insolvency practitioners to ensure the process runs efficiently and compliantly. As a result, Members’ Voluntary Liquidation is completed smoothly and with all formalities observed. Visit our Business Recovery & Insolvency page for more information about our services or get in touch today to speak to a member of our team.
Benefits of a Members’ Voluntary Liquidation
One of the key advantages of an MVL is its potential tax efficiency.
Funds distributed through an MVL are treated as capital rather than income, meaning:
- You may benefit from Capital Gains Tax (CGT) rates instead of higher dividend tax rates
- Eligible shareholders can claim Business Asset Disposal Relief (BADR) (formerly Entrepreneurs’ Relief)
- This can lower the tax rate on qualifying gains
Compared to withdrawing profits as dividends, this can result in significant tax savings.
We can work alongside your tax advisers, or our in-house tax team, to ensure the process is structured efficiently and remains compliant with HMRC requirements.
Why Choose Henderson Loggie for MVL support?
Henderson Loggie started in 1909 and over the years various partners took on insolvency work, however in early 1987 a bespoke insolvency team was established. Since then, the team has moved from strength to strength. Our current Insolvency team members have combined experience of over 160 years. They deal with MVLs, and all types of insolvent appointments from all over Scotland, but also have dealt with English appointments too.
Our team provide support to directors, business owners and individuals in assessing the options. Our goal is to make your company closure simple, compliant, and financially optimised.
Members' Voluntary Liquidation FAQ's
Most MVLs are completed within 6 to 12 months, although initial distributions to shareholders can often be made within a few weeks of the liquidator’s appointment. Read this blog about how quickly we can process an MVL.
The cost of an MVL typically starts from £5,000 + VAT, depending on the complexity of your company’s affairs. At Henderson Loggie, we ensure all costs are clear upfront, with additional disbursements such as statutory advertising and a bond.
Fees can vary, and while cheaper options exist, the cost reflects the level of expertise required. Factors such as the complexity of assets, distribution structure, and tax considerations all impact the work involved. A well-managed MVL led by a licensed insolvency practitioner helps ensure compliance, minimise risk, and achieve the best outcome for shareholders.
Yes, an MVL is one of the most tax-efficient ways to close a solvent company, particularly if you qualify for Business Asset Disposal Relief, which can significantly reduce your tax liability.
Retained profits are distributed to shareholders as capital distributions, rather than income, making them eligible for more favourable tax treatment. Read our latest guidance on how to extract retained profits tax efficiently.
Yes, companies with less than £25,000 in retained profits may use a strike-off process. However, this is generally less tax efficient for larger amounts.
Closing a solvent company via an MVL does not negatively impact your personal credit score, as all debts are paid in full.
Yes, an MVL legally requires a licensed insolvency practitioner to act as the liquidator and oversee the process.
If we have cleared funds on the day of liquidation, we can look to pay an interim distribution to shareholder within a week, should this be beneficial to their tax position.
Other than assisting the Liquidator, your duties are likely to cease on liquidation.
Yes, it is possible for assets to be distributed in specie, but there will be tax implications.
Testimonials from our clients
Meet Our Specialist Insolvency Team
Shona Campbell
Chair & Partner
Lianne Fraser Lusher
Manager
Lynn Barr
Assistant Manager
Kirstin Drummond
Assistant Manager
Speak to Henderson Loggie
We can arrange to meet with you in person, have a ‘Teams’ meeting, or call you to get an understanding of your issue and give you expert advice.
We do not charge for initial advice, and you are not obligated to progress matters with us following
advice. For further information contact: 01382 200055.
