If you have launched a limited company and it soon becomes apparent that it isn’t generating sufficient profit to cover mounting overheads, then it may be time to consider winding up the company.
The process can be straightforward if there are no major creditors or they can simply be paid off, but this isn’t always the case and sometimes winding up a limited company can be difficult and fraught with potential problems.
If liabilities are modest as they can be with a business that has only been in existence for a short period then directors should be able to wind up the company simply by ensuring any money owing to the business is recovered and realising stock. This can then be used to pay company debts.
HMRC will need to be notified that the business is winding up to avoid any issues later on and any disputed debts will also need to be dealt with as a priority.
Even if the process of winding up your limited company seems to be straightforward, it will be useful to seek advice from an insolvency practitioner who can help provide general advice as well as guidance on more complex processes