Closing down company

[ChilliLime]

Could anyone offer any general advice on this, i'm seeing my accountant on Friday but somehow I always get the impression he never gives me the full facts. Probably need a new one but thats another story!

I run a couple of businesses, one's web and software development which is where I devote 95% of my time. The other is a web based advertising portal which I bought outright 2 years ago, i'm director and the mrs is company secretary, we have no staff and were both paid via basic PAYE and the rest dividends. Standard stuff really.

Now the mrs has been offered a really good job, which we just cant turn down really, and I would like to concentrate 100% on my other business.

The company is solvent, the banks in credit and we have no outstanding creditors. We have a pending county court small claim for about 500 quid from a local company who charged us for a service they didnt provide. I've submitted a defence and awaiting a hearing date.

So...

Can I simply shut this company down without liquidation proceedings? Is it as easy as that if your company is solvent.

I've spent last couple of hours searching around but not turned much up. Any advice appreciated, just to have some prior knowledge for friday really.

Cheers

[Darren@UptonAccountants]

Company

If the company is solvent, you can have the company closed down without too much trouble.

A set of cessation figures should be prepared, pay off all the creditors (including Gordon Brown), inform the VAT/Tax office of the closure and obtain clearance that they have no objections. Then make a final distribution for remaining funds to shareholders of the remaining funds and close the company at Companies House using form 652a and a £10 cheque.

There could be a few tax planning opportunities when closing the company so best bring these up with your accountant on Friday.

[Crossroads]

If the company is a going concern (and it sounds like it is profitable enough to pay you salary & dividends) then why not sell it (or give it away)? I could be interested, pm me...

[ChilliLime]

What about the pending small claim, are they classed as a creditor even though we dispute that a debt exists?

I know from experience that we wont get a hearing for about 3 months, what happens if the company closes in the meantime?

Thanks

[Darren@UptonAccountants]

Creditor

You should wait until this is cleared otherwise you could be held personally liable for it.

[ChilliLime]

You should wait until this is cleared otherwise you could be held personally liable for it.

How would this work? Could the judge in the existing claim order a judgement against me personally?

Or would the claimant have to file a new claim against me in person?

Thanks

[Darren@UptonAccountants]

Company

When the directors of a company sign the 652a, it's basically an undertaking that all liabilities of the company have been paid. As you are aware that there is a potential liability that could arise, the claimant could come back to you with a fresh claim. This would also increase the amount of the claim due to additional court fees, interest, costs, etc. There are a few other permutations including being ordered to reopen the company, etc but the end result would be more costs and hassle.

If you're in doubt, would have a quick chat with an insolvency practitioner to confirm.