There are a few ways to start the process of liquidating an LLP, or limited liability partnership.
A winding-up petition can be filed against the company by creditors who wish to push the partnership into liquidation so they can get the money they are due.
In some cases, the partners may decide to voluntarily dissolve the company.
Additionally, partners can also dissolve the LLP by following the statutory process. In order to do this, partners must file a notice of dissolution with Companies House, and must also notify all creditors and members of the LLP.
Once the LLP has been dissolved, the partners must also file accounts and a statement of dissolution with Companies House.
How to liquidate a limited liability partnership
When a limited liability partnership (LLP) is facing financial distress, the partners have several options for liquidating the partnership’s assets.
- Voluntary liquidation – where the partners agree to dissolve the LLP and sell off its assets to pay off any debts and liabilities. This process is initiated by the partners filing a notice of voluntary liquidation with Companies House.
- Compulsory liquidation – which is initiated by creditors or the court, and is typically used as a last resort when the LLP is unable to pay its debts and the partners are unable to come to an agreement on a voluntary liquidation. In a compulsory liquidation, a liquidator is appointed by the court in order to realise assets and pay off any debts and liabilities.
- Administration – which is a process where an administrator is appointed to manage the LLP’s affairs, with the goal of rescuing the Partnership as a going concern or achieving a better result for the creditors than if the LLP were to be wound up.
LLP liquidation process
With over three decades of experience in the business and turnaround sector, Steve Jones is one of the founders of Business Insolvency Helpline. With specialist knowledge of Insolvency, Liquidations, Administration, Pre-packs, CVA, MVL, Restructuring Advice and Company investment.