Have you sold your business? Are you merging with another business? Are you retiring from your business? These are all reasons to consider closing your current business entity. If your business or company has ceased trading, has little to no assets and has paid all its outstanding liabilities, including employee entitlements and superannuation, then you may consider a process of voluntary deregistration to cease the existence of your company. It is a straightforward process conducted through the Australian Investments & Securities Commission.
If you voluntarily deregister your company, this means that your company will cease to exist. Your obligations and duties as a director and officeholder also cease. It can significantly reduce your personal risk of liability. If you voluntarily deregister your company, this means that you are not required to continue to pay the annual review fee, fulfil reporting requirements or to keep the company details up to date with the Australian Securities & Investments Commission. Below, we’ve set out the steps to voluntarily deregister your company.
How Can I Begin Voluntary Deregistration of my Company?
Before you can engage in voluntary deregistration, you need to make sure of the following:
- That the company is not currently conducting business;
- All of the company members (this means shareholders) agree to deregister the company. You can record this in a circular resolution signed by all shareholders;
- The company’s assets are worth less than $1000;
- The company has no outstanding debts. This includes no outstanding employee entitlements including no outstanding superannuation. This can be an issue for founders who have not paid themselves superannuation;
- The company does not have any outstanding ASIC fees or penalties; and
- The company is not engaged in any legal proceedings.
If your company has ceased trading and it satisfies the other steps set out above, it is possible to begin voluntary deregistration of the company. It is likely the most straightforward process for officially putting an end to a company’s life and to end your obligations as director and officer of the company. If your company does not meet the tests and requirements for voluntary deregistration, but is still solvent, you can choose to wind up the company instead, which involves a number of additional steps, which we have set out in our article, ‘How to Wind Up a Company’.
Our lawyers have assisted many business owners to exit their business and with selling or transferring any assets, including intellectual property, from the business as required. Questions about voluntarily deregistering your company? Get in touch on 1300 544 755.