Simple Liquidation

When a company enters a Creditors’ Voluntary Liquidation (CVL), one area that often raises questions for directors is the treatment of an overdrawn Director’s Loan Account (DLA). Understanding how this is handled is important, as it can have personal financial implications. A Director’s Loan Account records money taken out of the company by a director that is not salary, dividends, or reimbursed expenses. If a director withdraws more money than they have put into the company, the account becomes