
A Statutory Declaration of Solvency [the Declaration] is a key document in the liquidation process for a Members’ Voluntary Liquidation [MVL]. An MVL is a solvent liquidation procedure where, from the outset, it is envisaged that all creditors will be paid in full. Prior to the passing of the Special Resolution by the Shareholders to place the company into liquidation, both directors [if there are only 2] or a majority of directors [if there are more than 2] must declare before a solicitor the Declaration stating that the directors have made a full enquiry into the affairs of the company and are satisfied that it will be able to settle all its debts [together with Statutory Interest at 8% per annum payable to outstanding creditors] within 12 months of the commencement of the MVL. Under the Insolvency Act 1986 [the Act] it is a criminal offence for a company director…