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Thread: Winding up a cc

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    Winding up a cc

    Hi All

    Anyone who can help me with this issue regarding winding up of a cc?
    -What happen to the accumulated loss and the memberís loan if all other assets and liabilities have been disposed of and settled?
    Thanks

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    Hi Pieter,

    If the only items on the balance sheet is your accumulated loss and members loan, then you will more than likely lose that. In the good old days companies used to sell their "shelf" company with the accumulated loss and members loan so the new purchaser could utilise that tax loss. However, should the type of operations the company provides change that loss would be technically lost. So for instance, if your clothing manufacturing company has an assessed loss and you sell the company to new members who decide to run a consulting business, that tax loss you had for the manufacturing company would fall away.

    Gary

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    Moderator IanF's Avatar
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    Couldn't you sell the cc and someone else use the loan to save dividend tax?
    Only stress when you can change the outcome!

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    If you are referring to a legal winding up, then the member representing the members loan would receive a final dividend, along with all other creditors, provided the liquidated assets produced some funds.
    If properly wound up, the entity no longer exists - no accumulated loss and no anything else

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    Bronze Member Elijah's Avatar
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    I agree 100% with Clive. That is the whole point of Winding-up. The Company will cease to exist.

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