Winding up a Company

Winding up a company is most commonly used to describe the process of the insolvent liquidation of a company.

Insolvency of a company is most often shown by the inability of a company to pay those who it owes money to when their payments are due.

The difference between winding-up a company and liquidation is:

  • Winding up a company: This deals with ending business affairs and terminating company obligations before liquidation.
  • Liquidation: This deals with the sale of the company’s assets once it has closed.

Winding up a company in the context of liquidation refers to the closure or “winding up” of the affairs of a company.

Winding up a company can refer to a Creditors Voluntary Liquidation and also to Compulsory Liquidation if the company is insolvent.  When it is used to refer to the “winding up” of a solvent company this may refer to a Members Voluntary Liquidation.

Creditors Voluntary Liquidation is an insolvent company winding up procedure voluntarily started by the company directors.

Read more about Creditors Voluntary Liquidation.

Compulsory Liquidation is an insolvent winding up procedure which is generally initiated by company creditors (those who are owed money by the company).

Read more about Compulsory Liquidation.

Company Liquidation for a solvent company will refer to a Members Voluntary Liquidation.

Members Voluntary Liquidation is started by the Shareholders of a company with a view to distributing the value of the company assets to the Shareholders.

Read more about Members Voluntary Liquidation.


If you would like to discuss the above winding up procedures in more detail then please contact us today. We have a team of 4 Insolvency Practitioners who are here to help answer any question or query you may have.

Please note all advice given if confidential and is free of any charge and obligation.

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