Liquidation (winding up) is an expression to identify the process whereby the assets of a limited company are realised and the company ultimately dissolved. 

There are two types of liquidation;

1) voluntary liquidation
2) compulsory liquidation
Voluntary liquidations are divided into two further categories;
members' voluntary liquidation and creditors' voluntary liquidation

Members' voluntary liquidation

A company can be terminated by ¡§Members¡¦ voluntary liquidation¡¨ only if all the debts of the company are paid in full by the company or shareholders. The director of the company must issue a certificate of solvency in prior to the application of ¡§Members¡¦ voluntary liquidation¡¨.

Creditors' voluntary liquidation

A creditors' voluntary liquidation is a liquidation in which the shareholders and creditors of an insolvent company appoint a liquidator without any direct interference or control from either the court or any government department. 

Compulsory liquidation

A winding-up by the court is also known as a "compulsory" liquidation. It is initiated by an application to the court known as a "petition" presented by an interested party who is normally a creditor of the company. This type of liquidation is supervised by the court and the Official Receiver's office (a government department).