Closing an IR35 Company

 

 

SOLVENT

 

Many Contractors coming out of contract or embarking upon retirement have substantial sums of money remaining in the Company bank account.  The most common way to close down a Company is to take any retained profit as a dividend and then dissolve the Company.

 

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INSOLVENT

 

If a Company fails the HMRC's IR35 tests this will result in a large tax bill.

If the Company does not have sufficent funds available to meet this liability the Director then has the option to:

 

• Fight the decision (costly with little chance of success); or
• Invest personal funds in the Company to meet the liability; or
• Seek funding for the Company such as invoice finance or factoring (see also www.factoringandinvoicediscounting.co.uk); or
• Consider a Creditors Voluntary Liquidation.

 

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