There are two ways to terminate the operations of a Cyprus company as listed below:
- Strike off.
Strike off
The strike off procedure is a simple procedure that requires the following:
- Preparation and submission of the audited financial statements, up to the year preceding the strike off.
- Preparation and submission of all the company’s tax returns.
- Preparation and submission of all the company’s annual returns.
- Settlement of all government obligations to the VAT, Tax and Registrar of Companies.
Once the aforesaid are satisfied, a letter to the Registrar of Companies is submitted. The decision is published in the Official Gazette of the Republic and the company is removed from the records of the Registrar of Companies within 3 months.
Liquidation
The types of the liquidation of a company are Voluntary liquidation and Involuntary liquidation by court.
Voluntary liquidation is where the company’s members have decided to terminate the operations of the company, either because is no longer needed or it has served its purpose of incorporation. In order to proceed with the voluntary liquidation, the company must be solvent (company shall be able to settle its obligations and/or have no liabilities).
The liquidation procedure requires the following:
- Resolution by the shareholders for the decision to liquidate the company.
- Preparation and submission of the audited financial statements (net asset position).
- Sworn declaration of solvency by directors.
- Tax clearance certificate to be issued by the Cyprus Tax Department.
Once the aforesaid are satisfied, then a month notice for the final meeting of the company is published in the Official Gazette. Final minutes and liquidators’ statement of account are filed to the Registrar of Companies. Company is deemed liquidated after the lapse of three months.
Difference between strike off and liquidation
The difference between strike off and liquidation is that with the strike off a company may decide to resume its operation (following court order), whereas with the liquidation the company is dissolved, thus no way to re-operate.
In case of liquidation, the final order is being issued by court, whereas with the strike off there is no court involved in the procedure.
The strike off procedure is a cheaper and easier solution, especially for small entities which never had issues with third parties (including creditors, VAT and Tax office).
How can we help
At ACLA AUDITORS, we can help you terminate the operations of your company following any of the aforesaid methods.