Most people thinking about liquidating their company may think it’s a bad decision. However, it may be a positive step forward and the best thing in the long run. It may be hard to believe, there are some good reasons to liquidate your company. This video explains some of the good reasons to liquidate your company. Liquidation is often the last resort.
Thinking about liquidating your company? Here are some great reasons to go ahead with your decision.
To start with, you'll get to choose your own liquidator - one who really wants to help you resolve your situation. If a creditor decides to wind up your company through the courts they get to make the appointment and do you want your company's liquidation being handled by someone they choose?
Take care of your employees
By liquidating your company, you won't have to deal with angry employees. The governments fair Entitlements Guarantee helps employees who weren't paid their entitlements because their employer went bankrupt or into liquidation. You can find out more at the department of employment website.
Don't have to deal with creditors
You won't have to deal with creditors tracking you down for payments either. Your liquidator will write to creditors and put an end to being harassed for payments. They'll also put an end to any legal action which means you don't have to worry about going to court, stopping a sheriff executing a writ or stopping debt collectors chasing your company.
Uphold your legal responsibilities and avoid consequences
Here are some more benefits to liquidation:
- You'll eliminate the chance of breaching your directors duties which is strictly against the law.
- You'll avoid the risk of your company trading while insolvent - that is not being able to pay their debts as they fall due.
- You'll avoid being made personally liable for any PAYG Withholding or Superannuation your company hasn't paid to the Australian Taxation Office.
- Even if the ATO does send you the Director Penalty Notice that makes you personally liable, you can avoid it by putting your company into liquidation within 21 days of receiving it.
Get on with life
Most importantly by liquidating your company, you'll be able to get closure and move on. The stress and anxiety will start to ease and you'll finally be able to get on with your life.
Not sure whether your company is insolvent? XERO users can access our online Business Viability Tool to receive an instant score and suggested actions based on your personal situation. We know the decision to liquidate your company is a big decision. Learn more via our contact form or speak to one of the team now on 1800 861 247