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A Creditors’ Voluntary Liquidation (CVL) is a formal process used when an insolvent company can no longer pay its debts. The company directors initiate this process to appoint a licensed insolvency practitioner (the liquidator) who takes control of the company’s affairs, realises the company’s assets, and distributes the proceeds fairly among the company’s creditors.
A Creditors’ Voluntary Liquidation typically follows this timeline:
These timeframes are approximate and may vary depending on the complexity of the company’s situation and any issues that arise during the liquidation.
Cost-effective method of winding down your business
Put an end to hassling calls from creditors
Reduce stress and pressures from financial challenges
Solve your Directors Penalty Notice (DPN)
Mackay Goodwin guides you through corporate financial distress with a proven track record and end-to-end support.
Tailored Solutions. We customise our strategy to your business, from a fast exit to a planned wind-down that maximises asset value and reduces disruption.
Proactive Support. We provide clear communication and realistic timelines from your first consultation to final closure, reducing stress throughout the process.
Expert Guidance. Our ASIC-registered liquidators bring decades of experience delivering strategic, compliant advice on company liquidations across Australia.
Winding up your insolvent company for good? Liquidation is a formal process that ensures remaining assets are fairly distributed to creditors. Our experts guide you through every step, providing clear advice and support to help you exit with confidence and compliance.
Closing a solvent company doesn’t have to be complicated. We handle the communication with stakeholders, manage the liquidation process, and ensure assets are distributed smoothly and transparently.
If your company owes less than $1 million, you may qualify for this streamlined alternative to CVL. We’ll handle the process with clarity and care, helping you wind up the right way.
A Provisional Liquidator can help safeguard your company during uncertain times. We step in to take control, limit further damage, and protect the business while key issues are resolved.
Financial pressure can leave your company unable to meet ATO debt or creditor claims as they fall due. If there’s no viable way to keep trading, creditors’ voluntary winding up can provide an orderly way to deregister the company. Other insolvency processes may still be available. A CVL also differs from court liquidation, which follows a winding up order, and MVL, which applies to a solvent company. Voluntary Administration and Small Business Restructuring are separate processes that may suit some companies.
If your business is experiencing financial difficulties, it’s important to act early. The sooner you seek professional guidance, the more solutions may be available. Whether that’s restructuring and turnaround strategies, or formal liquidation.
At Mackay Goodwin, our specialists provide clear, confidential advice to whelp you understand your options and protect your future. We’re here to support you with empathy, and practical solutions tailored to your situation.
Edwin is a valuable member of the senior Mackay Goodwin team, with a huge amount of expertise and experience in running a range of different Deed of Company Arrangement proposals, for Administrations across a diverse range of industry sectors, and in all states across Australia.
David has a wealth of experience across receiverships, voluntary administrations and liquidations together with restructuring and turnaround engagements. Growing up in Bathurst, NSW, David’s interest in agriculture and passion for motorsport translates to his hands-on approach in the insolvency industry. Taking upon a broad range of appointments, David provides a thorough analysis of the current situations his clients are facing and provides the best possible outcome for them and other stakeholders. David’s experience allows him to draw on a broad range of prior appointments and their unique nature to facilitate the survival of a business where possible by using achievable arrangements.
Mitchell has 20 years’ experience in corporate insolvency and restructure. Mitchell is a Registered Liquidator having working on many types of corporate appointments. He has managed complex liquidations and voluntary administrations in numerous industries with expertise in property, finance, manufacturing, IT and building and constructions. Mitchell brings value to appointments from start to finish, from marketing and having initial contact with clients to achieving exceptional outcomes.
Grahame Ward is a Registered Liquidator and Administrator with expertise in industries like property, tourism, transport, hospitality, and manufacturing. Since 1996, he has specialised in corporate and personal insolvency, reorganisation, restructuring, and crisis management. As a Chartered Accountant and Official Liquidator, Grahame is known for delivering timely and practical advice, especially in complex insolvency matters. He is actively involved in professional development through ARITA, sharing his knowledge as a workshop leader. Grahame is committed to achieving positive outcomes for stakeholders, offering reliable support during challenging financial situations.
Gavin King is a seasoned business advisor and insolvency expert with extensive experience in corporate restructuring and turnaround management. Over the course of his career, Gavin has helped numerous businesses navigate complex financial challenges, providing tailored solutions that maximise stakeholder value. Specialising in insolvency administration, he brings a hands-on approach to managing voluntary administrations, liquidations, and corporate workouts. With a proven track record of leading successful recovery processes, Gavin leverages his deep industry knowledge to guide businesses through periods of distress, ensuring they emerge stronger and more resilient.
Andrew Quinn is a seasoned professional in the insolvency and restructuring industry, serving as a Director at Mackay Goodwin. With a deep understanding of complex financial challenges, Andrew has guided numerous businesses through voluntary administrations, liquidations, and corporate restructurings. His industry experience spans across sectors including construction, hospitality, and professional services, providing him with a diverse skill set to address each client’s unique needs.
Andrew’s strategic approach focuses on achieving the best possible outcomes for all stakeholders while navigating businesses through periods of financial adversity. His commitment to providing tailored solutions ensures that businesses receive the support they need to recover and thrive in challenging times.
Once a Creditors’ Voluntary Liquidation occurs, the business is deregistered and the company ceases trading. The liquidator collects and sells the company’s assets, settles creditor claims, and pays priority creditors such as employees owed outstanding wages and superannuation. If there are insufficient assets, employees may be eligible for assistance through the Fair Entitlements Guarantee.
After debts are addressed, remaining funds are distributed to unsecured creditors as dividends. At this stage, directors are released from personal liability for company debt unless there has been misconduct or evidence of insolvent trading.
A CVL is initiated by the company directors, not by the courts. Directors call a meeting where members formally pass a special resolution to wind up the company voluntarily, then meet with creditors to explain why the business can’t pay its unpaid debts. By choosing this route, directors aim to deal with outstanding creditors fairly and avoid the risks of insolvent trading, which can expose them to personal liability, such as through a Director Penalty Notice covering certain unpaid tax debts.
A CVL starts through the company’s own decision making process. Court liquidation, also called compulsory liquidation, follows a court order. Both can result in a registered liquidator taking control of an insolvent company.
| CVL | Court liquidation | |
| Who starts it | The directors, by passing a resolution that the company is insolvent and should be wound up | A creditor (or in some cases ASIC or a shareholder), by applying to the court to wind the company up |
| How it begins | Directors recognise the company can’t pay its debts and decide to act | Often follows an unpaid statutory demand, then a court order |
| Who chooses the liquidator | The company | The court |
| Control over timing | Directors choose when to act and can start quickly | No control, the timing is driven by the court and the applying creditor |
| Typical cost | Lower and more predictable | Higher, because of court and legal costs |
| The director’s position | A proactive step taken on the company’s own terms | A process imposed on the company |
| End result | Assets are realised and distributed to creditors in priority order, then the company is deregistered | Same end result |
The liquidator assesses outstanding employee entitlements and deals with eligible claims under the applicable priority rules, which also account for the liquidator’s fees and other costs of the liquidation before funds are distributed to creditors. Eligible employees may also be able to seek assistance through the Fair Entitlements Guarantee.
A CVL doesn’t automatically stop a director from starting another company. Restrictions can apply if you’re disqualified, and separate rules may restrict using the same or a similar company name.
Yes. The liquidator investigates the company’s affairs, including its records, causes of insolvency, insolvent trading, unfair preferences and other voidable transactions. This forms part of the liquidator’s role and doesn’t itself mean wrongdoing has occurred. Creditors may also form a committee of inspection to work with the liquidator throughout this process.
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