In the business industry, entrepreneurs set up several plans, but not all of them work out successfully. Furthermore, the financial difficulties at the beginning phase of a business make it difficult to deal with the vendors and suppliers. As a result, many businesses are forced to shut down at an early stage.
If you are also looking for some trusted ways to deal with the company closure in Singapore, the article below may help you better. There are two different types of windup procedures that can be followed in Singapore; entrepreneurs can either go ahead with voluntary closure or consider court orders as per creditor cases.
When we talk about voluntary closure, there are generally two main options available to businesses in Singapore. They can either take help from a professional liquidator in the area, or they can submit an application at ACRA for striking off the company. If the company directors believe that the entity will be able to handle the debts within a year of the winding-up process, they can consider liquidation with the members.
However, if the company has so many liabilities that cannot be handled easily, it may need to employ an approved liquidator Singapore to manage the affairs.
The process of Singapore company liquidation is described below to make it easier for the new business owners:
- The majority of directors in the company need to sign a written Declaration regarding Solvency, and it is submitted to ACRA.
- They need to announce an Extraordinary General Meeting (EGM) with all relevant members within just five weeks of the filling with ACRA. This meeting is necessary to pass a resolution regarding the company windup. Furthermore, the members also need to make decisions about liquidator appointment and their remuneration amount. Note that this resolution requires approval from a 75% majority.
- While declaring EGM and solvency, the directors are advised to contact a professional liquidator, most preferably an experienced accountant.
- Within just 14 days of the approved liquidator Singapore appointment, the directors need to post the Solvency Declaration as well as the appointment of the liquidator in the daily newspaper.
- Just within a week of passing wind up resolution for the company, it is important to file the printed copy of the resolution with ACRA.
- Once the liquidator receives all essential records of the company, they start handling all the management-related activities, especially the creditor claims, accounts, income tax details, and pending dues with company shareholders.
- When the company affairs are closed, the liquidator finally draws a document explaining the entire process of winding up, and the way assets of the company were disposed of.
- The Singapore company liquidation expert needs to present this document in front of the members in a general meeting.
- The liquidator needs to inform ACRA within seven days of the meeting. After three months of ACRA notification, the company can be officially dissolved.
These simple tips and tricks can help new entrepreneurs in Singapore proceed ahead with the closure.