If a private limited company in Singapore is no longer carrying on business and the business owner decides to end the business permanently, there are legal requirements to consider in order for the task to be successfully completed.
The company can engage company secretarial service apply to and get approval from the Accounting and Corporate Regulatory Authority (ACRA), the government agency pertaining to all firms and organisations incorporated in Singapore.
If the private limited company satisfies all the criteria and conditions based on section 344 of the Singapore Companies Act, ACRA will approve its application for liquidation.
Requirements for Striking off a Private Limited Company
- The company does not engage in any form of business operations starting its strike off application date or as soon as there was a clear intention of going through the strike off process.
- The company has tax liability clearance from the IRAS, has no outstanding debt with other government departments, and has no unresolved dues in the Register of Charges.
- The company has no involvement with any active or current legal proceedings within Singapore or in any other country.
- The company has properly discharged or disposed all of its assets and liabilities, ensuring that there are no contingent assets and or contingent liabilities.
- All bank accounts under the name of the company have been properly closed down.
- Has written consent from all the shareholders.
Steps for Closing Down a Private Limited Company
Application for Company Strike Off
After submission of the strike off application to the ACRA, the company must wait at least 7 business days for its complete processing.
Letter of Consent to Strike Off Company
If ACRA finds that the company has fully complied with the strike off requirements, a ‘Striking Off Notice’ will be sent to the company’s registered office address and residential addresses of the director and company secretary. The IRAS will receive a similar notification.
Objection to Strike Off Company
Any interested individual or stakeholder has 30 days to file a complaint or issue an objection against the strike off process that the company is going through.
Notification through the Government Gazette
If 30 days has passed without any complaints or objection about the strike off process of the company, the Government Gazette will publish its name so that the public will know about it. This is called the First Gazette Notification.
If 60 days has passed without any complaints or objection about the strike off process of the company, the Government Gazette will make its name public once again. This is called the Final Gazette Notification.
Entire Duration of the Company Strike Off Process
It will take about four months before the company receives a final notification that it has been struck off from the Register. The entire process of striking off a private limited company in Singapore can take up to five or six months.
Six Tips for a Smooth-Sailing Striking Off Company
Negotiating with Creditors and Lenders
When you are closing down your company, you need to notify the people and other businesses you’ve relied on – especially creditors and lenders – not because it is a legal or contractual requirement, but because it is a matter of good business practice.
Your customers should be properly notified that your business is going out. This will give you an opportunity to maximise your profits or revenues on or before the final closing date.
This will also minimise inconvenience on the part of your customers as they should not feel that they’ve been left in the dark after you’ve gained their trust and loyalty to your product or service offering.
This pertains to issuance of final pay check, reimbursement of expenses, or arranging for continue benefits.
It also refers to getting back any company property the employee has, deactivating passwords from the computer system and/or building premises, cancelling any account numbers in their name that are charged directly to the company.
Dealing with In-House Assets
Make a list of the tangible property your company owns and decide on the best way to turn them into cash to pay your debts or in a best-case scenario, to put in your pocket.
As for intangible property such as your commercial lease or contracts with suppliers and/or customers, you can try to put these up for sale too. Just make sure you keep good records of the transaction for your legal protection as well as for submission upon the request of the IRAS.
Legal Obligations to Fulfil
If you want to get a speedy approval of your strike off application from ACRA, make sure you have completed the following:
- An updated bookkeeping records
- Completed transaction of the disposal of assets and liabilities
- Full tax payments to the IRAS
- Full tax filings for all relevant years of assessment
- Proper company documentations supporting the strike off application
Engage Corporate Secretarial Service
In the absence of an in-house company secretary, a business may opt to hire a secretary service to take care of the necessary requirements prior to the submission of strike off application.
Corporate secretary services include submission of the required documents on the company’s behalf. The company secretary will ensure that all account statements and other documents relevant to the application for strike off are complete and updated.
With a professional secretarial service, business owners can rest assured that everything is organised and all information required will be complete.
Getting Help from Corporate Services Singapore
To get help in striking off of a Private Limited Company in Singapore is always a difficult decision; the process involved, however, is a more tedious and time-consuming task that you might not be ready to go through.
Let Corporate Services Singapore provide professional assistance on the procedure for closing down your company. When you have the specialists doing all the administrative work of striking off your company, you can concentrate on your next business move without any worry or concerns.