CH 26 - Informal Winding UP

Question 1

What is a beenefit of informal winding up of a limited company?

Answer 1

Informal winding up is a cheap and simple way to dissolve a limited company.

Question 2

What a company must do to claim Distribution prior to dissolution as a capital distribution?

Answer 2

1. must undertake procedures in s.1000 CA 2006 - power to strike of company not carying on business or in operation or
2. intends to make application under s.1003 CA2006
3. must have collected all debts and paid all liabilities due
4. cap on total distributions by the compny is £25k, excess is treated as income.
5. must be dissolved within 2y of the distribution

any failure e.g. collect debt or pay liablitys s.1030B CTA2010 will disapply s.1030A

Question 3

What should company must wait for to strike of company?

Answer 3

Any **tax refunds under CTA 2010, s.455 **must be received by the company prior to dissolution.

Otherwise the company cannot dissole itself under s.1003 CA 2006.