In an era of economic volatility, more company owners are looking to exit cleanly and tax‑efficiently through Members’ Voluntary Liquidations (MVLs). Knowing someone who is abreast of legal, regulatory, and any recent case law shifts is critical. Below is a roundup of the key developments that may affect how MVLs should be structured, advised upon, or executed.
High Court Clarifies Insolvency Claim Amendment Rules — Impact on MVLs
In mid‑2025, the High Court issued judgments clarifying the boundaries for amending claims in insolvency proceedings. One of the consequences is that insolvency practitioners now must be more cautious in drafting and allowing amendments to creditor claims, particularly in winding up or liquidation settings.
Specifically, guidance has been issued regarding MVLs, warning that certain claims—if amended late in the process—can impact distributions and challenge the certainty of final distribution. For accountants, this means:
– All creditor claims and proofs should be vetted early and comprehensively. (pre-appointment ideally to avoid statutory interest).
– Late‑stage amendments may expose distributions to challenge.
– Client advice around timing and documentation must be more precise to avoid disputes.
Transparency & Information Powers: Economic Crime & Corporate Transparency Act Impact
Under the Economic Crime and Corporate Transparency Act 2023, Companies House has enhanced powers to share non‑public information with insolvency practitioners. Implications for MVLs include:
– Greater ability to unearth undisclosed liabilities, related party transactions, or discrepancies.
– Heightened due diligence obligations before directors swear solvency declarations.
– Potential surprises in client affairs that must be addressed before a ‘clean’ MVL can proceed.
Supreme Court on Fraudulent Trading / Section 213 – Tighter Standards.
Strike off & Dissolution
A Supreme Court decision refined the burden of proof under Section 213 (fraudulent trading) in insolvency law. The ruling clarifies that even when a company is restored post‑dissolution, claims under Section 213 may remain, tightening the exposure of directors and parties involved.
For MVLs, this heightens the importance of:
– Ensuring full disclosure of past business transactions.
– Verifying there is no lingering exposure for improper trading behaviour.
– Structuring distributions with care, to avoid triggering successor liability or challenge.
What This Means for Your Advice as an Accountant
| Focus Area | Practical Shift / Advice |
| Early claim review | Insist on full identification and proper drafting of all creditor claims well before winding begins. |
| Enhanced due diligence | Use new powers (e.g. from transparency legislation) to probe hidden liabilities or transactions. |
| Document everything | Keep contemporaneous records of decisions, solvency reviews, and disclaimers to withstand judicial review. |
Conclusion
MVLs remain a powerful tool in the accountant’s arsenal for winding up solvent companies efficiently and tax‑optimally.
But recent court decisions, proposals for legislative reform, and rising regulatory scrutiny mean accountants must become ever more vigilant. By staying ahead of these changes, you can help your clients execute MVLs with confidence—and protect both their and your professional standing.