The cheapest is compulsory liquidation as you pay nothing!
Seriously though if you want the absolute cheapest way to go into liquidation then you wait for a creditor to petition the court to wind your company up via a compulsory liquidation.
Advantages
- Costs you nothing ( that’s it really )
Disadvantages
- Can take a very long time (year or more) so you cannot move on or start a new company easily with the assets or goodwill/name
- Employees will need to wait for any compensation. That includes directors that might be eligible for redundancy pay.
- Does not look very good on credit record should you wish to raise finance for another venture.
- Most importantly. The official receiver appointed by the court has unlimited resources to go after directors for wrongdoing and can pursue directors for money owed to the company.
So what about a cheap voluntary liquidation?
To be honest a voluntary liquidation is a legal process that brings about the end of the company. As such it is quite involved and highly regulated. No Licensed Insolvency Practitioner should be quoting less than £3000 + VAT unless they are hiding extra costs that you may have to pay later down the line. Most firms charge £4,000 to £6000. Incidently, it is more in Scotland and there are additional court costs that the liquidators have to pay.
if you have a Bounce Back Loan do not try and dissolve the company! All the banks receive a notice from Companies House if you try and they will object. So you either have to liquidate the company voluntarily or wait for the bank to apply through the court (risky, stressful and will take a long time)
