A Members Voluntary Liquidation (MVL) procedure is invoked where director/shareholders decide to close a company which has accumulated large reserves.
Using the Members Voluntary Company Liquidation procedure can lead to significant tax savings as the surplus is subject to Capital Gains Tax (currently 33%) as opposed to paying Income Tax, Universal Social Charge and PRSI (can be as high as 55%).
Members Voluntary Liquidation Procedure
The Liquidator will:
- take possession of the company’s property, including its books and records;
- list the people who are owed money and how much they are owed;
- list the people (if any) who must contribute to the company’s assets on its winding up and how much they have to pay;
- investigate the company’s affairs;
- sell the company’s assets, accounting for capital gains tax (CGT);
- pay the company’s debts; and
- give any remaining money to the members in line with their entitlements.
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