Creditors' Voluntary Liquidation
Creditors' voluntary liquidation is a formal U.K. process for winding up an insolvent company under the control of a licensed liquidator.
U.K. insolvency arrangements distinguish company liquidation from a supervised individual proposal to creditors.
This section covers two formal U.K. responses to insolvency for different legal persons. Creditors’ Voluntary Liquidation winds up an insolvent company under the control of an authorised insolvency practitioner. An Individual Voluntary Arrangement lets a person in England and Wales propose a supervised agreement to repay all or part of covered debts.
| Question | Creditors’ voluntary liquidation | Individual voluntary arrangement |
|---|---|---|
| Legal person | Insolvent company | Individual consumer or qualifying individual |
| Core outcome | Company assets are realized and the company is wound up | Approved proposal is performed under supervision |
| Control | Liquidator takes control from directors | Consumer remains responsible for complying with proposal terms |
| Approval | Shareholder winding-up resolution and required process | Creditor approval under the applicable decision procedure |
| Main alternative | Rescue, administration, company voluntary arrangement, or compulsory liquidation | Informal repayment, debt management, debt relief order, bankruptcy, or another available solution |
Do not treat the procedures as interchangeable debt-settlement products. Eligibility, creditor rights, assets, fees, voting, failure consequences, and geographic rules differ. Scotland and Northern Ireland have distinct personal-insolvency frameworks, and company procedure can also vary by jurisdiction.
These pages are educational and do not provide insolvency, legal, debt, accounting, tax, or financial advice. Current official guidance and qualified case-specific advice are necessary for a live matter.
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Creditors' voluntary liquidation is a formal U.K. process for winding up an insolvent company under the control of a licensed liquidator.
An individual voluntary arrangement is a formal England and Wales debt agreement proposed through a licensed insolvency practitioner and approved by creditors.