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dissolution.com.au

Folio i · From ASIC

Voluntary deregistration of a company

Voluntary deregistration is how a company chooses to close itself through ASIC, so that it no longer exists as a legal entity. It is open only to a company that meets six conditions, including that it is not doing business, its assets are worth less than $1,000 and it owes nothing.

General information only, not legal or tax advice. ASIC’s page on voluntary deregistration of a company is the place to check.

Why a quiet company still needs closing

ASIC’s first point on this subject is that a company which is no longer in business but is still registered must continue to meet its legal obligations. business.gov.au adds that this includes paying the annual review fee. ASIC also notes that a company which goes on not paying can end up deregistered by ASIC instead: the most common reason ASIC starts a deregistration itself is an annual review fee unpaid in full for at least 12 months after the due date.

The six conditions

ASIC lists these requirements for voluntary deregistration:

  1. All members agreeEvery member (shareholder) of the company agrees to deregister.
  2. No businessThe company is not conducting business.
  3. Small assetsThe company’s assets are worth less than $1,000.
  4. No outstanding liabilitiesNothing is owed. ASIC gives unpaid wages as an example of a liability.
  5. No legal proceedingsThe company is not involved in any.
  6. ASIC is paidAll fees and penalties payable to ASIC have been paid.

A company that does not meet these conditions but is solvent can be wound up as a solvent company instead. For a company that is insolvent, ASIC’s advice is to get professional accounting and legal advice as soon as possible, because it may need to be wound up as an insolvent company. The routes are compared in deregistration or liquidation.

What ASIC and the ATO say to settle first

ASIC says the company should dispose of all its assets before it deregisters, because otherwise they usually vest in ASIC or the Commonwealth afterwards. It should also cancel any Australian financial services licence or credit licence it holds. What vesting means is explained in what happens to company assets.

The ATO says that before a voluntary deregistration, all the company’s tax and super obligations must be up to date. Its list includes lodging all overdue and final tax returns and activity statements, paying all outstanding debts, finalising super guarantee payments and end-of-year reporting, and making sure a replacement trustee is appointed if the company is the trustee of a super fund or trust.

business.gov.au’s own list for before deregistering is short: close the company’s bank accounts, cancel any registered business names and licences, and lodge the final tax return. The tax side is set out in closing your ABN and GST.

The application, step by step

  1. Before the review fee

    Apply on Form 6010

    The application is made on Form 6010, online through ASIC’s company officeholder or registered agent portal, or by email if online lodging is not possible. ASIC says to apply at least 2 weeks before the next annual review fee is due if you do not want to pay it, to give ASIC time to process the application.

  2. With the form

    Pay the application fee

    There is an application fee, paid when you apply. ASIC does not refund it, even if the application is rejected.

  3. If approved

    Confirmation and a published notice

    ASIC sends confirmation that it will deregister the company and publishes a notice on its Published notices website. If the notice is not published before the review fee is due, the fee has to be paid before the company can be deregistered. If ASIC rejects the application, it says why.

  4. Two months on

    Deregistered

    Two months after ASIC publishes the notice, the company may be deregistered. If it is, it then shows as ‘Deregistered’ on the companies register.

Changing your mind, or objecting

ASIC says a company that has changed its mind may be able to stop a voluntary deregistration by contacting ASIC and explaining why it should not go ahead. ASIC reviews the request and responds within 28 days.

Someone else, such as a creditor, can ask ASIC to delay or stop the deregistration of another company, which ASIC calls deferral. The first deferral is for 30 days. To defer further or stop it, the person must have started, or plan to start, legal proceedings against the company. ASIC asks for the company’s name and ACN, the reason with any supporting evidence, and a postal address.

After it is done

Once a company is deregistered, the ATO says it stops paying refunds and processing forms for it, and cancels the company’s ABN and all its registrations, such as PAYG withholding and GST. Directors may still be liable for some debts from before deregistration under the director penalty regime, which covers PAYG withholding, net GST and the super guarantee charge.

If an officeholder or member made an incorrect declaration on the application, ASIC lists that among the examples of when a company may be reinstated. See reinstating a company.