Understanding the Key Requirements for Striking Off in Singapore
Striking off a company in Singapore is a formal process whereby a business entity is removed from the official register of companies. This procedure is often pursued when a company ceases operations and wishes to dissolve officially. Knowing the prerequisites for company striking-off is essential. It ensures compliance with legal obligations and prevents future complications or liabilities.
The striking off process is governed by the Companies Act of Singapore. The Accounting and Corporate Regulatory Authority (ACRA) oversees the procedure, ensuring that all legal stipulations are adhered to. ACRA plays a pivotal role in the striking off process, from reviewing applications to publishing notices and ultimately removing companies from the register.
Eligibility Criteria for Striking Off
Before proceeding with the striking off process in Singapore, companies must meet specific eligibility criteria to ensure compliance with regulatory requirements.
1. Inactivity of the Company
The company must be inactive, meaning it has either ceased all business operations or has not started any business since its incorporation date. This is a fundamental requirement to qualify for striking off.
2. No Outstanding Debts or Charges
The company must have no outstanding debts or liabilities. All financial obligations must be settled before applying for striking off. In addition, the company’s charge register must not contain any outstanding charges.
3. Compliance with Tax Obligations
The company should have fulfilled all its tax obligations. This includes filing all necessary tax returns and settling any outstanding taxes.
4. No Ongoing Legal, Regulatory or Disciplinary Proceedings
The company must not be involved in any ongoing legal proceedings. Any existing legal issues must be resolved prior to application. Moreover, the company should not be undergoing any regulatory actions or disciplinary proceedings.
Preliminary Steps and Documentation
To strike off a company in Singapore, certain preliminary steps and documentation must be completed to comply with regulatory guidelines.
1. Board Resolution
A formal board resolution must be passed to approve the decision to strike off the company. This is a necessary step to ensure all directors are in agreement.
2. Informing Shareholders and Stakeholders
Shareholders and other relevant stakeholders should be informed about the decision to strike off the company. This ensures transparency and allows for any objections to be raised. Extraordinary General Meeting (EGM) and other documents must be prepared for signing by all shareholders to confirm their acknowledgement of the striking off.
3. Statement of Affairs
A statement detailing the company’s affairs, including assets and liabilities, must be provided. This must be kept in the company’s statutory records as proof of the company’s eligibility for striking off.
4. IRAS Income Tax Return Waiver or Statement
If the company has not commenced business since incorporation, or its tax computation shows that the company does not need to pay any taxes, an application for tax waiver must be submitted to IRAS, and the subsequent approval letter obtained.
However, if the company has taxes to be paid, the company’s IRAS transaction statements must be retained after payment to show that it has no outstanding taxes before proceeding with the striking off.
Submission Process
Once the eligibility criteria have been met and the preliminary steps taken, the striking off submission process is a simple one.
1. Filing the Application with ACRA
The application for striking off must be submitted online through ACRA’s Bizfile+ portal by the company’s director, company secretary, or registered filing agent using their SingPass or CorpPass. Withdrawal of the striking-off application can also be requested through the same portal.
2. Review Process by ACRA
Upon approval of the application, ACRA may send a striking off notice to the company’s registered office address and to its officers (such as directors, the company secretary, and shareholders) at their recorded addresses.
If there are no objections within 30 days of the approval, ACRA will publish the company’s name in the Government Gazette, known as the First Gazette Notification.
If there are no objections within 60 days of the First Gazette Notification, ACRA will publish the company’s name in the Government Gazette again, and the company will be officially struck off the register. The date of the company’s removal will be specified, known as the Final Gazette Notification.
The whole process will take approximately 4 to 6 months.
Dealing with Objections
When dealing with objections to striking off a company in Singapore, it is crucial to address the concerns raised promptly and effectively. Once an objection is lodged, ACRA will halt the striking-off process until the issue is resolved. The company must engage with the objecting party to understand the nature of the objection, which may involve unpaid debts, unresolved legal matters, or other obligations. It is advisable to negotiate a settlement or fulfil the outstanding obligations to remove the objection.
Detailed documentation of all correspondence and actions taken should be maintained to provide evidence of compliance. If the issue remains unresolved after 2 months, the striking-off application will lapse. A new application can only be submitted once the objection has been resolved.
Post-Striking Off
1. Preservation of Company Records
Even after striking off, the company must preserve its statutory and financial records for a period of 5 years. This includes financial statements and other important documents.
2. Restoration of Company
A company can be restored within six years after its name has been struck off by obtaining a Court Order. This Court Order must be lodged via BizFile+, and the company’s status will be updated to “live.”
3. Director Disqualification
A director with at least three of his companies forced to be struck off by ACRA within a five-year period will be disqualified from acting as a director or participating in the management of any company for five years, starting from the date the third company is struck off.
Practical Tips for a Smooth Process
1. Engaging Professional Services
Professional advisors play a vital role and their guidance ensures all regulatory requirements are met. Engaging these professional services, such as registered filing agents and accounting firms, can facilitate a smooth striking off process. Choosing the right advisor is essential, so consider their experience and expertise in company striking off.
2. Regular Compliance Audits
Conducting regular compliance audits helps identify and rectify issues early. This proactive approach can prevent complications during the striking off process.
How Premia TNC Can Hep
Premia TNC offers comprehensive services to assist companies in Singapore with the striking off process. Our experienced team conducts a thorough compliance review, prepares all necessary documents, and liaises with authorities on your behalf. We assist in applying for tax waivers, resolving objections, and providing post-striking off support. With our expertise, you can navigate the process smoothly and ensure compliance with all regulatory requirements.
