3 ways to make the liquidation process as painless as possible
Whether the final decision to go to court was made by you or by your creditors, overseeing the liquidation of your own company is a challenging time for any business owner. Thankfully there are a few things you can do to help make the process as straightforward and painless as possible, meaning you'll be able to move on to the next stage in your life and career as soon as you're ready.
1: Pick your liquidation service wisely, and don't try to work through the process without professional support.
Depending on which state you're in, it may be technically possible to take personal responsibility for some aspects of the liquidation process—but others will legally require a professional, and all will benefit from expert guidance. Your first move should be to pick and appoint a reputable liquidation service and consult closely with them throughout. The court that ordered your liquidation might have recommendations that will give you somewhere to start choosing.
2: Stop trading entirely well before liquidation officially begins.
It can be tempting to try and make money for as long as you're legally allowed to, and in many cases, it will be theoretically possible for your business to keep trading right up until the end of the liquidation process. Ultimately, though, this runs a serious risk of making the period significantly more stressful. One main reason for this is the way that liability changes during the liquidation process: you'll need to appoint an accredited liquidator, and upon their appointment, they will become personally liable for any debt the company may incur. This not only makes it a high-risk endeavour, but it also means that most accredited liquidators will refuse to take on the job unless a company has formally ceased trading already.
3: Avoid any workaround that could run the risk of becoming a 'phoenix company'.
A phoenix company rises from the ashes of a business that has undergone the liquidation process. Sometimes this is done in a way that is outright illegal, such as by setting up a new almost-identical company to replace your current one and selling all the failed company's assets to yourself. There are other approaches that are less clearly against the law, but all are poorly regarded in the business world. You, your former employees and your future career will all be best served by a clean break. This is the most surefire way to help yourself move on to something brighter and more successful after the liquidation process has been completed.
Contact a service such as Menzies Advisory to find out more.