If your company has net assets of £25,000 or more, to return this capital to the shareholders, an MVL process must be used.

An MVL is a solvent liquidation. To demonstrate solvency, the company must be able to pay any outstanding creditors, plus statutory interest within twelve months. The formal Declaration of Solvency must be sworn by a majority of directors. An MVL requires the agreement of 75% of shareholders.

MVLs are often used as part of a tax planning exercise, maximising the available Capital Gains Tax reliefs and allowances.