Understanding Business Liquidation in Launceston

4 July 2025

Navigating liquidation in Launceston, TAS, can be overwhelming for any business owner. Whether facing financial hardship or choosing to close operations, understanding the process is critical for compliance and peace of mind. At O'Rourke Business Recovery and Insolvency Services, we help Launceston businesses manage this difficult transition with clarity and support.



Liquidation is the formal process of winding up a company’s affairs, selling off assets to pay creditors, and ultimately dissolving the business. It can be initiated voluntarily by the company directors or involuntarily through a court order. Regardless of the path taken, directors have legal responsibilities they must fulfil and understanding these is key to avoiding further complications.

The Liquidation Process: Voluntary vs. Involuntary

There are two main types of liquidation in Launceston, TAS: voluntary and involuntary. Each follows its own set of procedures and legal steps.


Voluntary liquidation occurs when a company’s directors and shareholders agree that the business is no longer viable. This is typically done through a Creditors’ Voluntary Liquidation (CVL), where a licenced liquidator is appointed to oversee the asset distribution. Directors initiate this process to address creditor claims in an orderly manner, often before creditors take legal action.


Steps involved in voluntary liquidation include

  • Passing a resolution to liquidate the company
  • Appointing a registered liquidator
  • Informing ASIC and lodging necessary documents
  • Realising company assets and distributing proceeds to creditors
  • Deregistering the company once debts are settled

In contrast, involuntary liquidation is usually court-ordered and initiated by a creditor when a company fails to meet its financial obligations. A creditor can apply to the court to wind up the company, and if approved, a liquidator is appointed by the court. This process often follows a statutory demand for payment that has gone unmet. Regardless of the type, both methods aim to pay off debts and ensure fair treatment of creditors.

Director Responsibilities During Liquidation

Directors play a crucial role throughout the liquidation process. Once the decision to liquidate is made, directors must act in good faith and in the best interests of creditors. They are required to:

  • Cooperate fully with the appointed liquidator.
  • Provide accurate financial records.
  • Refrain from incurring further debts.
  • Ensure no preferential payments are made to specific creditors.

Failure to meet these obligations can result in penalties, personal liability, or even disqualification from managing future companies.


It is also worth noting that directors should seek professional advice as soon as financial difficulties arise. Early intervention often allows for a broader range of solutions, including potential restructuring, rather than moving directly into liquidation.

Seeking Professional Guidance

Understanding your legal responsibilities and the liquidation process is vital to minimising risk and protecting your interests. At O'Rourke Business Recovery and Insolvency Services, we work with businesses across Launceston and Tasmania to provide tailored, professional support during difficult times.


Whether your business is experiencing insolvency or you’re looking to wind up operations responsibly, our team can guide you through the necessary steps and legal procedures. We take the pressure off directors by handling creditor communications, ensuring compliance with regulations, and helping bring closure to complex financial issues.


You can explore our insolvency and liquidation services here to see how we support businesses through each stage of the process.

Professional Support for Liquidation in Launceston, TAS

Liquidation in Launceston, TAS, doesn’t have to be overwhelming. With the right guidance and support, directors can approach both voluntary and involuntary liquidation with clarity and confidence. At O'Rourke Business Recovery and Insolvency Services, we’re here to help you understand your options and move forward with a tailored solution that protects your business interests.


To learn more or speak with our experienced team, contact us here or call 0418 491 140. We're ready to help you take the next step.