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Unexpected events can occur in the life of your business, leading you to consider deregistering your company. Such events can include selling your business, merging your business with another company, or closing down your business entirely. Your business or company may have ceased trading, has little to no assets and has paid all its outstanding liabilities, including employee entitlements and superannuation. In that case, you should consider voluntarily deregistering your company to avoid having to pay any ongoing company costs. This article will discuss the process of voluntarily deregistering your company through the Australian Investments and Securities Commission (ASIC).

What Is Voluntary Deregistration?

If you are eligible for voluntary deregistration, you can close your company and cease to be an office of the company. In effect, this means that your company will cease to exist. Your obligations and duties as a director and officeholder also cease. Therefore, it can significantly reduce your personal risk of liability. If you voluntarily deregister your company, you are not required to:

  • continue paying the annual review fee; 
  • fulfil reporting requirements; or 
  • keep the company details up to date with ASIC.

Am I Eligible to Voluntarily Deregister My Company?

Before ASIC allows you to deregister your company voluntarily, your company must meet certain criteria. For example, you must ensure that your company:

  • assets are worth less than $1000;
  • is not conducting business;
  • has no outstanding liabilities, like unpaid employee entitlements;
  • is not involved in any legal proceedings; and
  • has paid all fees and penalties payable to ASIC.

Likewise, all members of the company must initially agree to deregister the company. If your company does not meet the above requirements, ASIC will reject your application.

Are There Other Essential Steps?

ASIC also recommends additional steps to take before lodging your application. One such step is to close any company bank accounts and review all company records. In addition, you want to ensure that all company property (such as vehicles, land, shares, trade marks, intellectual property, leases, permits) are have been appropriately transferred or sold. Likewise, ensure that no property remains registered in the company’s name and that all transfers of company property are registered. 

Additionally, if the company is a trust, ensure you appoint a new trustee, and that company legally owns no trust property. Essentially, you want to transfer or cancel all registered business names the company holds, plus any licenses the company holds. 

I Am Eligible. How Do I Voluntarily Deregister My Company?

You can apply for voluntary deregistration by lodging an Application for voluntary deregistration of a company (Form 6010). Currently, it costs $42 to apply. This fee is non-refundable if you do not meet the eligibility requirements and ASIC rejects your application. You can lodge this form online or submit it via post. When lodging a paper form, a director or member of the company must sign the application. A liquidator of the company can also sign the form. 

I’ve Lodged My Application. What Happens Next?

There are two possible outcomes of applying for voluntary deregistration of your company. These are:

  • approval – ASIC will write to you to confirm your company’s impending deregistration and publish a notice on their website; or
  • rejection – ASIC will write to you to advise why it has rejected your application.

What Are the Effects of Deregistering Your Company?

Deregistering a company is a big decision with many flow-on effects. Hence, it is essential to weigh these up before submitting your application. Of course, each company is different. Typically, once you deregister your company, it ceases to exist as a legal entity and can no longer operate or do anything. 

Likewise, any property that the company owned (except for trust property) vests in ASIC. Also, property held by the company on trust vests in the Commonwealth with ASIC as the trustee. The former officeholders (including directors) no longer have the right to deal with company property.

Additionally, a party cannot continue any legal proceedings in which the company is a party, and no party can start legal proceedings against the company. 

Key Takeaways

If your company has ceased trading and satisfies additional elements, it is possible to begin voluntary deregistration of the company. It is one of the most straightforward processes for officially putting an end to a company’s life and ending your obligations as director and officer of the company. You can do this online or by mailing the completed form to ASIC. If your company does not meet the tests and requirements for voluntary deregistration, ASIC will reject your application. However, you can still wind up your company in other ways. There are many effects of deregistering your company which you should consider before submitting your application.

For more information on the process of voluntary deregistration, contact LegalVision’s business lawyers on 1300 544 755 or fill out the form on this page.

Frequently Asked Questions

What is voluntary deregistration?

If your company meets certain criteria, you can apply for voluntary deregistration. This means your company will close, and your obligations as a company officeholder will cease.

Can all companies apply to deregister voluntarily?

No. There are specific eligibility requirements you must meet before you can apply for voluntary deregistration. If you do not meet these, ASIC will reject your application, and they will not refund your application fee.

How do I voluntarily deregister my company?

You can apply for voluntary deregistration by lodging an Application for voluntary deregistration of a company (Form 6010). Currently, it costs $42 to apply. You can lodge this form online or submit it via post.

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