Closing A Company By Striking Off
Before a company is closed off, a move that is officially recognised as “struck off” relative to its inclusion in the list of Singapore-registered businesses, it has to meet certain criteria that will justify the said decision to close down. A company applies for striking off from the Accounting and Corporate Regulatory Authority (ACRA), the same government entity it has applied for business registration.
The following criteria must be fulfilled before a company can apply for striking off. Do note that every single one of them must have been fulfilled, otherwise the ACRA cannot grant applications for closing down, or will require further requirements to be submitted.
First criterion: The company has already stopped trading, or else has never conducted business since the date of its incorporation. Companies may have a host of reasons for stopping trading, but bankruptcy is a common one.
Second criterion: The company must have no outstanding tax obligations with the Inland Revenue Authority of Singapore (IRAS). Before being officially struck off, companies must fulfill all their payable obligations. Further delays may also cause additional penalties. Likewise, the third criterion stipulates that the company must pay off all its outstanding financial obligations to other government departments.
Fourth criterion: The company must bear no outstanding charges in its charge register. Those who have uncollected charges must aim to have them settled before applying for striking off.
Fifth criterion: The company must not be facing court proceedings, both in and out of Singapore.
Sixth criterion: The company must have no current or else contingent assets and liabilities.
Seventh criterion: The company must secure the written agreement of the majority of its shareholders in order to proceed.
In case a company has never started operations since the day it was incorporated, it will be required to submit a letter explaining its special circumstances through either the director or a company secretary. The letter must explain that the company has never started operations since incorporation; that it has no bank account (or if there is, the account will have been closed already). Finally, the company must not have previously held an Annual General Meeting (AGM).