Reasons Why Company Liquidation is a Great Idea

What exactly company liquidation is?

In simple terms, if a company can’t be able to pay its debts and process business operations, then choose to distribute its assets to claimants, shareholders, and creditors. Company liquidation can be voluntary or involuntarily as well. Whether your business is large or small, liquidation can apply to both. However, it is a great exit strategy that can be profitable for business owners and shareholders. It’s no secret that Dubai is one of the largest financial centres across the world. In fact, Dubai is also known as the fastest developing city in the Middle east. So, if you want to expand your business overseas then Dubai is one of the best destinations that you should choose.

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Let’s dive straight into some reasons why company liquidation is a good decision:

It Avoids Risk of Breach

Not paying debts and keeping your business operations on hold can put you in a very difficult position. Your creditors and employees can sue you due to a breach of your duties. Company liquidation saves you from such risks.

It Avoids a Potential Director Penalty Notice (DPN)

Issuing a DPN notice means that you are liable for your company’s unpaid Superannuation and PAYGW. Liquidating your company on time prevents you from such notices. Isn’t it great?

It stops harassment from creditors and shareholders

If you are not able to pay debts on time, then your creditors and shareholders harass you for payment. Here, you can go with company liquidation. Liquidating your company can stop creditors and shareholders from harassing you. Apart from this, you have the option to distribute your assets to clear all debts.

In the End

Clearly, liquidation is a great way to bring a company to an end. In fact, it is a safe way to liquidate your company and clear all the pending debts. Certainly, declaring your company as insolvent is not easy but initiating the company liquidation process can save you from many penalties.

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