As new companies start up each year, existing ones gradually close down for a variety of reasons. If you find yourself having to close down your company, you have the choice of striking it off the Accounting and Corporate Regulatory Authority’s (ACRA) register or winding up the business. In this article, we will cover how to strike off your Singapore-based company.
What Does Striking Off a Company Mean?
Striking off a company involves removing it from ACRA’s registry and dissolving it. A company director may initiate a strike-off procedure, or ACRA may file the motion under certain circumstances. In both cases, a strike-off is performed if it is believed that the company has ceased trading or if it is no longer necessary to continue operating. However, striking off a company does not clear any remaining outstanding debts with the relevant authorities or with other parties.
Striking off is typically a more straightforward procedure for closing down smaller or dormant companies, whereas winding up a company is a more formal process for companies undergoing legal proceedings, such as insolvency.
Key Requirements for Striking Off a Company
Before striking a company off from ACRA’s register, it must meet several requirements that serve as reasonable causes for ACRA to consider the company as non-operational.
- The company has not commenced business since its incorporation, or is no longer in operation.
- The company has no outstanding debts owed to the Inland Revenue Authority of Singapore (IRAS), the Central Provident Fund (CPF) Board, or any relevant government agencies.
- The company has no outstanding charges in the charge register.
- The company is not involved in any legal proceedings within the country or abroad, as well as ongoing or pending regulatory actions or disciplinary proceedings.
- The company has no existing assets or liabilities as of the application date, and no contingent assets or liabilities that may arise in the future.
- All or a majority of the director(s) authorise an applicant to submit the online application to strike off on behalf of the company.
- The company has no outstanding tax credits owed to the company. Otherwise, this tax credit will be paid over to the Insolvency and Public Trustee’s Office (IPTO).
Failing to meet any of these requirements may result in fines or other penalties. For example, if a company fails to settle all outstanding tax liabilities and obligations with IRAS, IRAS may object to the strike off, and the application may take longer to resolve.
The Process for Striking Off a Company
Initial Application
To begin the strike-off process, the company director, company secretary, or corporate service provider will first submit an online application through Bizfile. The company does not need to pay any filing fee for this transaction. The company may withdraw the application via BizFile if it decides not to pursue the striking off process.
Reviewing the Application
After the application is approved by ACRA, a striking off letter is sent to the company’s registered office address, as well as to its officers (such as directors, company secretaries, and shareholders), at their registered addresses as per ACRA’s records. ACRA will also notify the IRAS and CPFB to inform them of the strike-off application, where they will conduct their own reviews related to the company.
If no objections are raised, ACRA will publish the company name in the Government Gazette, as part of the First Gazette Notification. After 60 days from the First Gazette Notification, if ACRA receives no further objections, ACRA will subsequently publish the company name in the Government Gazette once again, before the company’s name is struck off the register (the Final Gazette Notification). The strike-off date is then recorded for filing purposes. Note that this entire process may take at least four months to complete.
Objections to the Strike-Off
If any party objects to the company’s strike-off, they may file an objection via BizFile, with no filing fee necessary. The reasons for the objection must be stated clearly, accompanied by additional documentation to support the objection. Failing to provide any documentation may result in the rejection of the objection.
Should the objection be approved, the company will be notified of this by ACRA and must resolve it within two months. Should the company fail to do so within the stipulated timeframe, the company’s striking-off application will lapse, and a new application must be submitted after the objections have been resolved.
Once the objection is resolved, the person or party who objected must clear it within two months from the date they submitted the objection to allow ACRA to continue the strike-off process.
Reinstatement of the Company Name
Even after a company’s name has been struck off the ACRA register, it can still be restored within six years after the strike-off date, via court order. The court order will be lodged through Bizfile, after which the company’s status will now be updated to “live”.
If you need assistance with the striking-off process, My Office is ready to help with our various corporate services, providing you with peace of mind in handling the application process. Contact us today to find out more.
