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When a company owner no longer wishes to keep the business going, it is worth dissolving the company by a voluntary decision of the shareholders. Otherwise, you will have to spend time and money every year, for example, filing the inactive company’s annual reports with the commercial register.
Failure to file the reports can result in fines for the company and its management, and the company can be subject to compulsory dissolution by the court. In the case of compulsory dissolution, if the company owns assets, it may be difficult to make transactions with them.
Experts can reduce the hassle of this time-consuming process
In a voluntary liquidation, the company’s assets are sold, creditors’ claims are settled, and the remaining money is distributed among the shareholders. As the final result, the company is deleted from the commercial register. In liquidation proceedings, liquidators have a number of tasks to perform, the correct resolution of which is essential to achieve the most beneficial outcome, so it is wise to call on the services of experienced professionals.
Appoint liquidators
The shareholders of the company will decide on the solution, and the decision will be entered into the commercial register together with the entry appointing the liquidators. The liquidators are usually the members of the management board, but other competent persons may also be appointed for this role.
The liquidators draw up the liquidation report and the annual report, sell the company’s assets, collect its debts, and satisfy the claims of creditors. If the assets are insufficient to meet all of the claims, the liquidators are obliged to submit a bankruptcy petition to the court.
An example of why experts should be involved in liquidation proceedings is the common situation where, during the proceedings, the tax authorities are forgotten to be contacted in order to claim and recover, if possible, the money in the company’s advance payment account.
In case assets remain after settling the claims
Once all the creditors’ claims have been satisfied, the liquidators, together with the company’s accountant, draw up the final liquidation balance sheet and an asset distribution plan. Normally, the remaining assets or the proceeds from the sale of assets are distributed among the shareholders in proportion to the nominal value of their shares.
Here, before the final distribution of the assets, is the last moment when the shareholders can decide to continue the company’s activities, merge, divide or transform it instead of deleting it from the commercial register.
Hedman can help you liquidate your company
If you have any questions about the above or if you are facing a liquidation process, Hedman’s lawyers are ready to advise you. Contact us!
