There is a lot to consider when closing a business in the Netherlands. You will have to deal with many regulations. For example, the end of your company has consequences for tax and for registration with the Chamber of Commerce. In this article we indicate which steps you need to take when closing a business in the Netherlands.
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Liquidating a company is an important step when closing a business in the Netherlands. If a sale or takeover is not possible and if there is no bankruptcy, you can liquidate your company. All current affairs must be settled. You can think of collecting receivables, paying off debts and stocks have to be sold.
This process is called the liquidation phase and it is important that you apply the correct rules. During the liquidation phase, we could guide you through every step that needs to be taken. The aim is to deregister your company from the Trade Register.
There are roughly three steps in the liquidation process of your company:
1. the decision to dissolve;
2. liquidation; and
3. deregistration from the Trade Register.
The (public or private) company will have to be dissolved by a resolution of the general meeting of shareholders. Under the articles of association, a special majority of votes is required for a resolution to dissolve. Also, a certain quorum is usually required under the articles of association. A quorum is the number of voters that must be present to make a decision. Therefore, it is advised to first consult the articles of association.
At this point, the legal entity does not immediately cease to exist. The private or public limited company continues to exist for as long as is necessary to liquidate the assets of the company.
As we indicated earlier, the receivables are collected, debts are paid and any inventories are sold. The liquidation is done by one or more liquidators. They usually are the directors of the company, but that is not necessary. As soon as the decision to dissolve the company has been taken, ‘in liquidatie’ must be added after the statutory name of the company in all documents and announcements.
If all creditors have been paid and there is still an amount left over, the liquidator must pay this amount to the shareholders, unless the articles of association provide otherwise.
Deregistration from the Trade Register
The liquidation ends when there are no longer any assets known to the liquidators. Only then the end of the company is realized. This should be filed at the Trade Register. You must also deregister with the tax authorities.
If there are no assets on the company’s balance sheet at all, no liquidation as described above needs to be done. This is the fastest way of closing a business in the Netherlands but it is not open to all.
As the general meeting of shareholders takes the decision to dissolve, the company immediately ceases to exist. The liquidation should be filed at the Trade Register. There is no need to appoint a liquidator. Then, the director of the company is responsible for clearing the company’s income. When properly prepared, a turbo liquidation can save time and money.
The tax authorities also play a role if you discontinue your business. First, you should have deregistered your company from the Trade Register. As soon as you have done this, the tax authorities will be notified automatically. Your company’s tax number and VAT identification number (VAT ID) will be discontinued. You will receive a confirmation from the tax authorities of the termination of your company. If you do not receive the confirmation, you will have to inform the tax authorities yourself that your company is closing.
Then, there are a few more actions that need to be performed with respect to fiscal regulation. The administration of your company will have to be closed. Your company’s records must be kept for seven years. The annual accounts will still have to be drawn up until your company is terminated. A final settlement will still have to be made. You must submit an income tax return to the tax authorities for the last year that the company was still active. The last fiscal step is to submit a final VAT return.
Produced by Kune 21/04/2022
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