Strike off your company from ACRA registers
What is Company Strike off
A business once established may not work to the expectations of the promoter. It may not achieve its targets of sales, profit and hence may prove unviable for the entrepreneur to continue.
The company which is not really operative, is best put to sleep. This process is called as Strike off. Company if in spite of its dormant status remains active then the directors will need to carry out all routine compliance like conducting AGM, preparing accounts, filing IRAS and so on.
For a dormant company there is always a danger that the directors may forget about these activities and this noncompliance may attract heavy fine from ACRA or even a warrant of arrest.
ACRA Amendment Bill 2014
Non-compliant small entities, has become one of the key issue in recent times. it’s easy to incorporate a company. But then if business doesn’t takes off then it’s also easy to ignore the company. Today over 260000 companies are live in Singapore and a sizable proportion of these companies is inactive. Majority of these inactive companies are in noncompliant status and hence ACRA is taking strict view on such non-compliant companies. Two key changes will happen with this ACRA Amendment bill.
- The fines for non-compliance ( Like failure to conduct AGM, filing AR, preparing accounts) will go up
Compounding of offences by paying fine will be stopped in some cases. In past ACRA used to issue summon to appear in a court to Directors in case of a persistent ignorance of company compliance.
However it was possible to pay a fine (usually of 700 SGD) and get the summon withdrawn. However under new framework, paying the fine and getting summon withdrawn will not be possible in some cases. Director in such a cases will have to appear before the court and then pay the fines which judge may impose.
Strike off vs Liquidation
A company can be striked off only if it is solvent. Meaning on the date of application for strike off it does not have any external payables or the payables can be easily paid out of the assets of the company.
If the company is not solvent, meaning if its debts cannot be paid out of its assets then it cannot opt for strike off. Instead it must go for liquidation.
In case of liquidation a liquidator is appointed by the court to oversee the closure of the company process, who then works out the distribution of assets and its proceeds to the creditors.
Following conditions must be met before a company can file application for strike off
Steps involved in the strike off process
|Step-1||Initial visit Fix up an appointment and visit our office with all your company related documents. If accounts are to be completed then bring along accounting invoices, bank statements and other expense vouchers. Our staff will go through it and ask for clarifications wherever necessary. These activities can also be organised over e-mail.|
|Step-2||Payment Once the scope is clear, you will need to make the payment to us. You can pay by cash, nets or a locally issued check. Bank transfer is also an option.|
|Step-3||Preparation of accounts We will send the details for accounts preparation (if applicable). This step usually takes 2-3 weeks. If accounts department has any further questions they will get in touch with you for clarifications. This clarifications can be done over email. Accounts once prepared will be sent for your review.|
|Step-4||Second visit Once the accounting task is over you will need to visit our office 2nd time. This time all shareholders and directors of the company need to visit with their NRIC / passport. In this visit you will sign all required forms and resolutions. In all approx. 8-10 documents needs to be signed. Once signing is done we will send company for strike off. We will track the strike off process and keep you updated of status.|
What happens after strike off application is lodged
Some frequently asked questions on Strike off
Yes. We can still help you to strike off your company. However the strike off notice will still be sent to the secretary and the company’s registered address. If you have an agreement with them to avail their secretary services only then they can potentially object for using other company for strike off. So you will need to settle this matter with them before you proceed for strike off.
We can help you to strike off. However Nominee Director will also need to sign some declarations. So you need to check with your existing secretarial firm if their nominee Director can sign such form if strike off process is managed by somebody else.