Paying out a capital distribution

[Madeleine II]

Hello!

The Limited company hasn’t traded since July 2019.

It’s not going to be needed anymore so we are closing it.

The accounts to 25th January have been done and there's £29k left in the company. There are expenses of £500, dividends of £3500 and £25,000 capital distribution.

We are ready to submit the DS01.

My question is about timing.

Do we submit the DS01, make the relevant payments, close the bank account and advise HMRC all potentially on the same day, or do we have to wait for something else before making the payments?

Thanks.

 

[StevensOnln1]

Pay all of the money out of the company bank account before sending the DS01 as the bank may freeze the account once they see the proposed strike off.

 

[Madeleine II]

Excellent thank you!

 

[Clinton]

An MVL gives you ER.

 

[pentel]

An MVL gives you ER.

after allowing for liquidator fees and CGT zero rate band this may be more expensive than paying the tax.

 

[Clinton]

Depends on the amount involved. In fact if it's under £25K then ER is automatic as under £25K is treated as capital withdrawal rather than income. Anyway, these are not matters for a forum but for professional advice from someone who knows all the circumstances.

 

[Madeleine II]

An MVL gives you ER.

The company hasn't been trading since July 2019 so unfortunately not eligible for ER.

 

[Madeleine II]

Depends on the amount involved. In fact if it's under £25K then ER is automatic as under £25K is treated as capital withdrawal rather than income. Anyway, these are not matters for a forum but for professional advice from someone who knows all the circumstances.

Yes indeed Clinton. The question was just about timing.

 

[Madeleine II]

after allowing for liquidator fees and CGT zero rate band this may be more expensive than paying the tax.

Thanks Pentel. Hopefully I've done my sums right and have chosen the best option Just don't want to fall foul of a rule I can't find with regard to the order in which things should happen.