If you do international business and are in Singapore, you may have thought about the steps you need to take to liquidate a business. Perhaps there are many reasons behind making such a decision, but the fact is that it is not an easy process and it helps to have the help of professionals when necessary.
Procedure to cancel business license in Singapore
You must cancel your business license when your Singapore-based business closes. If you want to close your business in Singapore, you need to do the following:
For???? Notify the Corporate and Accounting Regulatory Authority (ACRA) to remove your business name from the official register. Please note that this only works if you are a local business owner. While this is the quickest and least difficult route to take if you want to end business operations, you must meet the following criteria to qualify:
For???? Your business must have completely ceased its corporate and business operations.
For???? The business must be debt and tax free from the point of view of the Internal Revenue Authority of Singapore (IRAS).
For???? You cannot owe money to creditors. You also cannot have accounts receivable from customers on the ACRA charge register.
For???? You must not be involved in any local or international legal litigation or dispute.
For???? Your company should not be subject to regulatory action or disciplinary procedures.
For???? Your company must not have tangible assets and / or outstanding debts (liabilities)
For???? ACRA directors must approve your request to close your business and strike your legal name off the official record.
How to cancel your business license
You must cancel your corporate GST license with IRAS because your company will no longer need it. Generally speaking, your business will be removed from the official registry approximately five to six months after you submit your application if it is approved. If you are the owner of a sole proprietorship or partnership, you must submit the “Termination of Business” transaction online.
If you are a business owner (an LLC or LLP), you will apply to the ACRA to formally liquidate and dissolve your business. As part of this process, the ACRA will assign a liquidator to your company. This professional will manage the formal processes of evaluation of corporate assets, closing of operations, payment of debts and distribution of capital to shares and interested parties. Once you have officially dissolved your business and operations, you will have to deal with the following:
For???? Termination of employment: You will need to alert your employees that they are about to lose their job approximately a few weeks before the official closure of the company. Many companies (although not required) to help their employees find work after their official employment ends. Your human resources department should do the same. You must pay all outstanding wages, benefits, and unused leave time. If you are unsure of the appropriate amount of compensation for your employees, consult your contractual or collective bargaining agreements.
For???? Corporate asset allocation: If you own a sole proprietorship, all of your business assets legally belong to you. However, since your business is not protected from liability, your creditors can legally force you to sell these assets to pay off your debts. Any remaining money and / or assets are legally yours.
For???? If you own a partnership, the assets belong to you or the business. However, if you sell your business to someone else and that person does not receive repayment of your corporate debts, all of your assets will legally belong to that person. See Section 44 of the Associations Act for further information and details.
For???? If you own a corporation (business), all assets belong to the business. You do not have the legal right to claim them for yourself. The only exception occurs if the company has no debts or has paid all outstanding debts. In this case, you can legally claim the remaining corporate assets. Also, remember to keep official books and records for a maximum period of five years after your corporation has been officially removed from the official record.
Cancellation of license in Singapore
If you want to cancel your Singapore business license, you need to make sure your business (corporation) has no outstanding debts or taxes. This includes any outstanding business loans. In this case, you must officially inform your creditors about the future closure of your business. You should also tell them when, how and to what extent you will reimburse them. In addition, you can use the services of Global Corporate Advisory Services with experience in such procedures.
You should seek legal advice to help you determine which creditor claims are legally valid and which are not. You must also ensure that your business does not owe taxes to government agencies. You can determine this using these methods:
For???? Go to myTaxPortal to see all your pending and paid taxes. This will include corporate taxes and GST.
For???? Call IRAS’s free 24-hour answering service. You will be able to inquire about the status of your corporate taxes and GST with a representative.
It is about liquidating a company in Singapore
As can be seen from the information analyzed, it is about liquidating a company in Singapore. If you are thinking of liquidating your company, it is important to hire the services of a global business consultancy so that they take care of the true complexities of the entire process. They eliminate stress and navigate the complexities of corporate law to help you close a business in Singapore.
