Good Lawyer Guide's response

Liquidation is the process where a liquidator (a qualified insolvency practitioner) is appointed to wind up the affairs of a company. This involves selling the assets and paying off the debts of the business, and once all the money is distributed the company is effectively dead.

If you place your company into liquidation this is called ‘voluntary’ liquidation. It sounds like you need to consider seriously the viability of your company and if you conclude that it cannot pay its debts then you can make the decision to go into voluntary liquidation. But if you wait, a creditor could chose to apply for compulsory liquidation of your company in order to recover its debts from you. The court could then make a winding-up order that the company be placed into compulsory liquidation.