If your company is inactive and you do not wish to continue incurring costs to maintain the company, the best way is to close down the company. Striking off is the easiest way to close down the Company. Most of the companies would opt for striking off as it is cheaper compares to liquidation.
Requirements for Striking Off
A company is an incorporated association. Once it is formerly registered, it becomes a separate legal person. It is an artificial person created by incorporation. The company can sue and be sued in its own name. It can own property and incur debts. The liability of its shareholders is limited to any amount unpaid on their shares. When the shares are fully paid-up, the shareholders have no further liability to contribute towards the debts of the company. In Singapore, a company is incorporated under the Companies Act, Cap. 50 and the statutory requirements and the incorporation process are as follows:
- The company has ceased operation or have not commenced activities from the date of incorporation;
- The company has no outstanding penalties or offers of composition fine owing to ACRA;
- The company has no outstanding charges in the Registrar of Charges.
- The company has no outstanding tax liabilities owing to Inland Revenue Authority of Singapore (IRAS).
- All outstanding Income Tax Returns have been submitted.
- Accounts and tax computations have been submitted up to the date of cessation of business.
- No outstanding tax matter before closure of bank account.
- GST registration has been cancelled and there are no outstanding GST matters.
- The company is not involved or threatened with legal proceedings within or outside Singapore.
- The company has no debts owed to any Government authorities.
- The director(s) have obtained the written consent of the majority of shareholders to strike the name of the company of the register.
- The company has no contingent assets and liabilities (i.e. assets/ liabilities that may arise in the future).
- Written consent from the majority of the shareholders must be obtained.
- Finalised accounts drawn up till the date of cessation must be attached.
Striking Off Process
Once the application is approved, ACRA will send a striking off letter to the company’s registered office address, its officers (directors and company secretary) at their residential address and to IRAS and CPFB.
If there is no objection within 1 month, ACRA will publish the name of the company in the Government Gazette. This is referred as the First Gazette Notification.
If there is no objection during 60 days from the First Gazette Notification, ACRA will publish the name of the company in the Government Gazette again and the name of the company will be struck off the register. The date that the company is struck off will be stated. This is known as the Final Gazette Notification. The entire process will take at least 4 months.
Lodgment of an Objection against Striking Off
Any interested person can submit an objection against a striking off application. If ACRA receives any objection, ACRA will withhold the application and notify the company to resolve the outstanding matter within 2 of the date of objection. Failure to do so, the striking off application will lapse. The company can only submit a new application after the objection has been cleared.