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How to Close a Company in Ireland: A Complete Guide to Voluntary Strike-Off

How to Close a Company in Ireland A Complete Guide to Voluntary Strike-Off

By Antonia Nikolic, 20th September 2024

Closing a company is a significant decision, often due to changes in business circumstances, financial pressures, or strategic redirection. In Ireland, a voluntary strike-off is one of the most common methods for voluntarily closing a business. This method is simpler and less costly than liquidation, making it an attractive option for companies that meet specific criteria. In this guide, we’ll walk you through what you need to know about how to close a company in Ireland via a voluntary strike-off.

What is a Voluntary Strike-Off?

A voluntary strike-off is a process where a company, no longer operational, can apply to be removed from the Companies Registration Office (CRO) in Ireland. Once struck off, the company ceases to exist as a legal entity, and its name is removed from the Companies Register.

This method is typically used by companies that are no longer trading, are solvent, have settled their debts, and have no assets in excess of €150. It’s an effective way to close a company without going through the more complex and costly process of liquidation.

Key Benefits of a Voluntary Strike-Off

Opting for a voluntary strike-off offers several advantages:

  1. Cost-Effective: Compared to formal liquidation, the strike-off process involves fewer fees and administrative requirements.
  2. Quicker Process: Once all the paperwork is in order, the process typically takes a few months to complete.
  3. Minimal Formalities: The strike-off process is less cumbersome than winding up a company through liquidation.
  4. Finality: Once the company is struck off, it no longer exists, which means there are no ongoing tax or legal obligations.

When to Choose a Voluntary Strike-Off

It’s important to note that not all companies qualify for a voluntary strike-off. You should consider this option only if your business meets the following conditions:

  • The company is solvent: This means the company can pay off its debts, and there are no outstanding liabilities.
  • No ongoing trading activity: The company should have ceased trading.
  • Settled all tax obligations: All taxes and statutory filings, such as VAT and Corporation Tax, should be up-to-date and cleared with Revenue and the company should have deregistered for tax.
  • Assets distributed: If the company holds any assets, they should be distributed to shareholders before applying for a strike-off.

Don’t meet these conditions? There are other options like liquidation which might be more appropriate.

Key Steps to Take Before Starting the Voluntary Strike-Off Process

Before initiating the voluntary strike-off, there are several essential actions you must complete:

  1. Close the Company Bank Account
    Make sure to close the company’s bank account. Any funds left in the account will be frozen once the company is struck off.
  2. File All Outstanding Annual Returns
    All overdue annual returns must be submitted to the Companies Registration Office (CRO). If you need assistance with this, let us know, and we can provide a quote for the service.
  3. Submit All Outstanding Tax Returns and De-register the Company for Taxes
    Ensure all tax returns are filed with Revenue, and proceed to de-register the company from tax obligations.
  4. Verify the Company’s Assets and Liabilities
    Confirm that the company has no assets or liabilities exceeding a value of €150.
  5. Cease Any Registered Business Names
    Ensure any business names associated with the company are formally ceased.

How Company Bureau Can Help

Now that we’ve covered the essentials, let’s walk through the process of voluntarily striking off a company in Ireland with the help of Company Bureau. Our Voluntary Strike-Off (VSO) service ensures compliance with the requirements of the Companies Act 2014, which include:

  • Obtaining a letter of no objection from the Revenue Commissioners
  • Placing of Legal Notice in a National Daily Newspaper
  • Application in writing for a Voluntary Strike-off to the Companies Registration Office (CRO)
  • Publication of the strike-off notice in ‘Iris Oifigiúil’

What Happens Next?

Once the VSO application is lodged and processed by the CRO, the company will be dissolved within 90 days from the date the legal notice is published, assuming no objections are raised. However, during this period, any person may submit an objection to the Registrar if any of the grounds have not been satisfied. If no valid objection is received, the company will be officially struck off by the Registrar and dissolved.

What Happens After a Company is Struck Off?

Once the voluntary strike-off is complete, the company ceases to exist as a legal entity. The company’s name is removed from the Companies Register, and it no longer has any legal standing. This means the company cannot engage in any business activities or enter into contracts.

Additionally, any remaining assets that were not distributed before the strike-off process will be transferred to the State.

Potential Pitfalls and Considerations

While the voluntary strike-off process is straightforward, there are some potential pitfalls you should be aware of:

  1. Outstanding debts: If your company owes any debts, creditors can object to the strike-off process. This could result in the application being denied or delayed.
  2. Director disqualification: If you apply for voluntary strike-off while still owing taxes or failing to meet legal obligations, you risk being disqualified as a director, preventing you from holding director positions in other companies.
  3. Reinstatement: If a company is struck off in error or prematurely, it can be reinstated by applying to the High Court. However, this process can be costly and time-consuming.

Conclusion

Closing a company in Ireland via voluntary strike-off is a practical and efficient solution for directors who wish to cease business operations with minimal fuss. If your company is solvent, has ceased trading, and has no outstanding liabilities, this method can provide a smooth path to formally shutting down the business. However, it’s essential to follow the process carefully and to ensure that all statutory obligations are fulfilled before submitting your application to the CRO.

Want to make it hassle free? Company Bureau can undertake all the steps involved on your behalf to ensure the company is closed compliantly–and in the quickest possible timeframe.

Disclaimer This article is for guidance purposes only. It does not constitute legal or professional advice. No liability is accepted by Company Bureau for any action taken or not taken in reliance on the information set out in this article. Professional or legal advice should be obtained before taking or refraining from any action as a result of this article. Any and all information is subject to change.

Antonia Nikolic