Although Company Strike Off is inexpensive, it may not be the most cost-effective way to close your company. If your company is asset-rich or has substantial cash reserves, a Members’ Voluntary Liquidation (MVL) may be more cost-effective.
The main advantage of an MVL is that the profits you extract from the company are subject to capital gains tax rather than income tax or dividends tax. If you’re also eligible for Business Asset Disposal Relief, you’ll pay just 10% tax on qualifying assets. Although £25,000 is the legal threshold for a Members’ Voluntary Liquidation, the liquidator’s fee means that you’ll typically need around £35,000 in retained profits for an MVL to be more cost-effective than strike off.