Covid-19 brought serious struggles in front of growing businesses around the world. Most of them failed to cope with the economic stress, and many others found it difficult to adjust to the new normal. There is no surprise to say that many companies are no longer able to continue their operations or have become insolvent. Reports reveal that almost 43,000 businesses ceased in 2020, and the count is rising further in 2021 as well. Many business professionals are planning to close their inactive companies so that they can proceed ahead with profit-oriented work only.
If you are also looking for the best ways to settle to close Singapore Company, this article may help you better.
There are generally two ways to close down the Singapore business – either by striking off the company name from the register or by winding up the entire business. You just have to choose the right way to do this.
Striking off the company
You can submit an application to Accounting & Corporate Regulatory Authority for striking off your name from the register. However, before proceeding ahead with this company liquidation Singapore, you need to satisfy the below criteria:
- The company should have ceased trading.
- There should be no outstanding debts to the CPF Board, Inland Revenue Authority of Singapore, or any other government agency.
- There should be no outstanding dues in the charge register.
- The business name should not be involved in any legal proceeding within or even outside the country.
- The company should not be subjected to any pending or ongoing regulatory action.
- All or majority of directors are ready to strike off the company.
Other than this, if the company is registered for GST, it has to submit an application with IRAS for cancellation of GST. Any company director or registered filing agent can submit an application to a strike-off company, and it doesn’t require any fee. As soon as the application is received, a no-objection notice will be issued, and if no objections are received for the next 60 days, the company name will be struck off.
Winding up or liquidating a company
It is also possible to use company liquidation Singapore when business owners have ceased the activities. This option is used when the company is engaged in some shareholder-related disputes, management deadlock, or is involved in some financial restructuring.
An extraordinary general meeting must be announced to pass the resolution related to company windup, and right after that, the company needs to cease all operations. There are generally three possible ways to company windup: businesses can either choose member’s voluntary wind up, creditors’ voluntary wind up, and compulsory wind up. It is possible to hire a liquidator to handle the entire procedure on behalf of company directors to close Singapore company. The amount received after liquidation is used to pay off the pending debts of the company, and if some funds are left after that, they may be distributed further among shareholders. In the case of compulsory winding-up, the procedure is handled by the court. This option is followed when the company is not able to pay off its pending debts.