Are you looking for expert guidance on the winding-up process for a company? Whether you’re thinking about winding up your company, or just curious about the process for your future planning, our guide is a great place to start.

Read on to find out what you need to do, the legal requirements and actions to take.

Meeting ASIC’s requirements

The Australian Securities and Investments Commission (ASIC) is Australia’s regulator for corporate, markets, and financial services. It ensures that financial markets operate fairly and transparently and that consumers are protected from misleading and deceptive conduct in financial services. It also grants licences to financial services and credit providers and enforces regulations and compliance.

For ASIC to accept your application to voluntarily deregister your company, you will need to ensure you fulfil each of these requirements:

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• all members of the company must agree to deregister
• the company must not be conducting business
• the company’s assets must be worth less than $1,000
• the company has no outstanding liabilities (for example, external debts)
• the company is not involved in any legal proceedings
• the company has paid all fees and penalties payable to ASIC.

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Preparing to deregister your company

If you are satisfied that you have met the requirements from ASIC, there are some steps you will need to take to prepare, ahead of deregistering:

• if your company holds an Australian Financial Services Licence (AFSL) or an Australian Credit Licence (ACL), they should be cancelled in the first instance
• cancel or transfer any business names held for the company
• close company bank accounts (after final tax payment or refunds received)
• if the entity is a trustee company, you must wind up or vest the trust (or transfer to a new trustee)
• finalise any tax matters; for example, pay your final dividend payment, lodge your final company tax return, and cancel your GST, PAYGW, ABN, FBT and any other tax registrations.

If the company has any credit amounts on its account, these should be refunded before lodging the ASIC Form 6010 to deregister the company. To avoid paying an annual review fee, Form 6010 must be lodged at least two weeks before payment is due.

The process to voluntarily deregister a company

Once you have ensured you’re meeting ASIC’s requirements and completed the steps above, it’s time to start the official process to register your company. The following steps are a great place to start:

• All members will need to agree to voluntary deregistration. If consent has not been obtained, the deregistration process cannot be started
• Directors in your company must declare all conditions are met and will need to sign written resolutions to confirm this
• You will need to lodge ASIC Form 6010 and pay the deregistration fee within 28 days. The form and supporting documents can be signed and lodged electronically, and the invoice to pay ASIC’s fees can be obtained from company compliance software, such as CAS360 or ASIC portal).

Once ASIC has approved your deregistration, the following will happen:

• ASIC will update your company’s status on ASIC to Strike-Off Action in Progress. It’s important to note that, unlike liquidations, directors will still have their powers whilst the company is in ‘strike-off mode’
• ASIC will publish a notice of deregistration on ASIC’s Public Notices
• Your company will be struck off two months after public notice
• You (as the applicant) and the nominee will be notified of deregistration by ASIC by letter.

Even after your company has been deregistered, you should ensure that company statutory documents are kept for seven years for any queries from agencies in the future.

Finally, it’s critical that all documents, forms, and lodgements are accurate, as directors who make false and misleading statements about the conditions of deregistration can be prosecuted, fined, convicted, and disqualified from managing a company for up to five years.

How BDO can help

Deregistering a company is not a decision that is made lightly. Directors must ensure that once they and any other stakeholders or members decide to deregister a company, they meet all of ASIC’s requirements and complete the process accurately and truthfully.

If you are considering deregistering your company and would like to explore how BDO can help you, contact us today for expert advice.