This is the question directors ask first and get answered last. There is no national fee scale, so no page can quote you a price — but the structure of how insolvency fees work is knowable, and knowing it is what stops you being quoted badly. This is general information, not advice about your company.
There is no statutory fee scale for insolvency work in the UK. Fees depend on the size of the company, the number of creditors, whether there are assets to sell, whether there are disputes, and how much work the case turns out to need.
That is a genuine reason, not an evasion — but it is also used as one. A practice that has seen your figures can give you a realistic range for a straightforward case, and should. If a firm will not put a range in writing after reviewing your position, that is information about the firm.
This is the distinction that matters more than the headline number.
Where the company has assets, insolvency fees are normally paid out of asset realisations before creditors are paid. The director pays nothing personally. This is the usual position in a CVL for a company with stock, equipment, debtors or a vehicle.
Where the company has no assets, there is nothing to pay the practitioner from. In that case a practice will generally require the fee up front, and in a small company that usually means from the directors personally. A firm advertising a fixed-price liquidation is nearly always describing this scenario.
So the honest answer to “who pays for a CVL” is: the company, if it can, and the director, if it cannot. Ask which of the two applies to you at the first conversation, because it is the difference between a closure that costs you nothing and one that costs you thousands.
Deliberately expressed as relative scale rather than invented figures, because quoting prices for work this variable would be misleading.
CVL. The cheapest formal route, and the most standardised. A small company with few creditors and no complications sits at the bottom of the range; assets to realise, many creditors, or a disputed director’s loan account move it up quickly.
MVL. Comparable to or slightly below a simple CVL, because the company is solvent and there are no creditor disputes. Usually paid from the funds being distributed.
CVA. Higher than a CVL, and charged in two parts — a fee for drafting and proposing the arrangement, then ongoing supervisory fees for the years it runs. The second part is easy to overlook and materially changes the total.
Administration. The most expensive by a distance. Larger cases, more work, active trading decisions, and often legal costs alongside.
Three bases are used, sometimes in combination: a percentage of asset realisations, time costs at hourly rates, or a fixed fee. In a formal appointment the basis of the liquidator’s or administrator’s remuneration has to be approved — by creditors, by a creditors’ committee, or by the court — not simply set by the practice.
Separately from the fee, there are disbursements: statutory advertising, bonding, storage, agents’ and valuers’ fees, legal costs. These are charged in addition and are a common source of surprise. Ask for them to be listed, not summarised.
Yes, but somebody has to fund it. The usual answers are: the directors pay the fee personally; the company sells something first; or, if there is genuinely nothing and nobody will fund it, the company is left to be wound up compulsorily by a creditor, which costs the director control and does nothing good for the conduct report.
Striking the company off instead is not an alternative where there are creditors. Creditors can object to a strike-off and often do, and directors who use dissolution to avoid dealing with debts can face disqualification and, since the Rating (Coronavirus) and Directors Disqualification (Dissolved Companies) Act 2021, investigation even after the company is dissolved.
All six should be answerable in writing before you sign the engagement letter. There is a fuller list of first-conversation questions on the first call page.
Who pays for a creditors' voluntary liquidation?
The company, where it has assets — the fee comes out of realisations before creditors are paid, and the director pays nothing personally. Where the company has no assets, the practice will normally require the fee up front, and in a small company that usually means the directors pay it themselves.
Are liquidation costs paid from company assets?
Yes, where assets exist. Insolvency fees and disbursements rank ahead of unsecured creditors and are paid out of what the liquidator realises. That is why a company with stock, equipment or debtors can often be liquidated at no personal cost to the director.
Can I liquidate a company with no money?
Yes, but the fee has to come from somewhere — usually the directors personally. The alternative, leaving a creditor to petition for compulsory liquidation, removes the director’s control over timing and over who acts as liquidator.
Is the first conversation with an insolvency practitioner free?
Almost always, yes. Most practices offer an initial conversation at no charge and no obligation. Confirm it before the call rather than after, and be clear that a free first conversation is still a sales conversation.