2. Arrange liquidation with your creditors

A director can propose a company stops trading and be liquidated (‘wound up’) if:

  • the company can’t pay its debts (it’s ‘insolvent’)
  • enough shareholders agree

Get shareholders’ agreement

You must call a meeting of shareholders and ask them to vote.

75% (by value of shares) of shareholders must agree to the winding-up to pass a ‘winding-up resolution’.

Once the resolution is made there are 3 steps you must follow.

  1. Appoint an authorised insolvency practitioner as liquidator to take charge of liquidating the company. You can find an insolvency practitioner online.

  2. Send the resolution to Companies House within 15 days.

  3. Advertise the resolution in The Gazette within 14 days.

Your responsibilities as a director will change.