Striking Off a Company in Singapore: Process and Requirements

Introduction to Striking Off a Company in Singapore

The shutdown of a business is a big business process, which involves proper housekeeping of legal and finances. To most small businesses and dormant businesses in Singapore, voluntary striking off may be a cheaper option to a liquidation process as long as the company satisfies some of the statutory requirements and is free of liabilities. By being well prepared and complying, delays, objections, and possible personal liability of officers are avoided.

The present guide discusses the steps that are practical, the legal requirements and realistic time taken to strike off a company in Singapore. It points out what directors and company secretaries need to prepare, the way ACRA treats applications and objections, and the consequences you need to be ready to face after your company has been struck-off, which is especially relevant for those involved in MAS regulatory compliance training for financial professionals.

Eligibility and Preconditions.

Qualifications of Voluntary Strike-Off.

A company can request the Accounting and Corporate Regulatory Authority (ACRA) to strike off the name of a company when ACRA is convinced that the company has been in business and fulfills the requirements as stated in the statute. The common preconditions are that, the company shall not have any assets or debts pending, it shall not be engaged in any legal action, it shall have submitted all the necessary statutory returns and member (shareholder) consent shall be sought regarding the application. These eligibility checks form the biggest part of the assessment by ACRA before the strike-off application is approved. The step-by-step process for striking off a dormant or closed company in Singapore ensures that every requirement is fulfilled before dissolution begins.

When Strike-Off Is Not Permitted

Strike-off will usually be rejected or postponed whenever the company owes unpaid taxes, unsecured creditor claims, litigation or it is a subject to regulatory inquiries. Specifically, IRAS regularly expresses an objection to a strike-off application where tax payable or outstanding GST/CPF issues have not been settled – such objections must be removed before ACRA continues with that. In the event that objections cannot be cleared in the allotted period, the applicant has to clear them and reapply.

The Voluntary Strike-Off Process.

Board Resolution and Consent of shareholders.

The board should hold a meeting and get the required authorisations to apply to strike off before applying to ACRA. Many private companies have this as a board resolution and the majority of the members (shareholders) should consent in writing, or special resolution is passed should this be a requirement of the constitution. It is necessary that directors take all the company requirements in consideration and make shareholders aware of the legal impact of strike-off dissolution and loss of legal existence.

Getting the Application and Supporting Documents ready.

The application is filed through the portal of BizFile+ of ACRA by an authorised officer, company secretary or a registered filing agent. The finalisation of accounts and tax returns, the closure of bank accounts, the termination of business registrations like GST (where applicable), the provision of clearance by service providers and updating the company statutory registers are generally part of the preparation. The application package must prove that the company is not insolvent, ceased trading, and paid all the liabilities.

Public Notice, Objections and resolving disputes.

Upon acceptance of an application by ACRA, a striking-off notice is internal and sent to the company, the officers and other relevant agencies like IRAS and CPF Board. Interested parties have a time frame to file objections through BizFile+; the objection has to be filed by any creditor or interested individual and they have to include supporting documents. In the event of an objection being received, ACRA will inform the company and will normally give time to resolve the objection. The unresolved objections may then stop the strike-off and instead the process may demand liquidation.

Legal Requirement and Timely.

Statutory Obligations Pre-strike Off Before and After.

The meeting of statutory obligations leading to the point of dissolution fall on directors and the company secretary. This involves the submission of outstanding annual returns, payment of tax and CPF, and maintenance of appropriate records after strike-off that the statutory retention period (to be used in audit or possible reinstatement order). The company seeking to apply has to cancel the registration in GST with IRAS.

Expected Timeline and Common Delays

According to the legal requirements and timeline for voluntary company strike-off under ACRA, the process usually takes at least four months from submission to final gazette notification. The reason behind this is that prior to the dissolution, ACRA has to issue public notices and give objection time.

The delays are usually caused by the unresolved tax issues, annual returns, or missing documentation. Hiring a competent corporate service provider has the advantage of making sure that all the supporting paper work is correct and in line before submissions.

Checklist and Checklist Alternatives.

Checklist in a Minute to a Smooth Strike-Off.

Prior to application, ensure that:

• There are no missing accounts and tax filings.
• Bank accounts are terminated and creditors are satisfied.
• Registers are current and are statutory.
• Consent of the shareholders is is secured.
• This is the cancellation of GST registration (where applicable).
• All the officers know their responsibilities.

Avoiding objections or reinstatement requests down the line: this is done by keeping corresponding records and correspondence.

When It is Time to Look at the Alternatives.

A Members Voluntary Liquidation (MVL) might be a better option than strike-off in case the company has assets or debts to pay. Liquidation enables orderly payment of debts and allocation of the leftover assets in a professional manner. Strike-off on the other hand fits small and dormant companies with clean financial books.

Following the Company Being Struck off.

As soon as the last Gazette notice is issued, the firm is technically disbanded and no longer a legal person. It is not able to trade, possess property, and make agreements. Nonetheless, corporate officers have to maintain corporate records not less than five years.

In the event that there is a necessity to reopen the company e.g. to pay unclaimed assets or unresolved liabilities, ACRA can reopen it via a court order. The directors must therefore make sure that all the loose ends are closed prior to the strike off of the company.

Conclusion

The Singaporean strike-off is a cheap and easy to do business closure alternative in the event the business has shut down and all the liabilities paid. It might be considered simple, but it needs to be followed with care, on time, and in the required format. This will help business owners leave the register without any complications that are unnecessary since they have understood all the steps, the procedure has been approved, and there is a secretarial support to rely on in order to do so in a compliant manner.