La cessation of activity is the last phase of closing process from a company. She inevitably ends up final disappearance. There are two forms: judicial liquidation and amicable liquidation. These procedures raise many questions. Foundation-company-ricard addresses them in 10 questions and answers. Here'essential to know about liquidation :
1. What is the Final Settlement?
La liquidation is a process of ending the legal life by company. This means that it has ceased its activities and is concentrating on the “liquidation” of its assets. The main objective is to sell the remaining assets and repay creditors.
The liquidation procedure ends with the permanent deletion of the company. The commercial court then proceeds to its unsubscribe of official records. A declaration of liquidation is drawn up at the end of the operations.
2. What are the factors for the dissolution of a company?
Dissolution, which leads to the disappearance of a company, can come from a OK or an court decision.
In the first case, it is the result of a voluntary choice shareholders (or sole shareholder). They then vote for early dissolution. However, the company must be in good financial health and not be in a situation of cessation. Otherwise, the partners cannot opt for an amicable liquidation.
In the second case, the liquidation is decided by a court (the commercial court for traders). We are talking more specifically about judicial liquidation. As a general rule, it occurs after a "filing for bankruptcy" or at the request of certain people. In order for the judges to decide on a liquidation, it is necessary that the revival of the company seems impossible.
3. What about the liquidation period?
Once the dissolution has been pronounced, a special period, known as the " liquidation period ", begin. During this, one person (the liquidator) has several tasks to perform.
It must first list the assets and reserves of the company. Then he must to put up for sale these assets and recover unpaid debts. Finally, he must payer all the debts of the company: suppliers, tax, social, banking, etc.
4. Who can be appointed as liquidator?
As part of a voluntary dissolution, every person may assume the position of liquidator. He is chosen by the partners and they will also determine the duration of his mandate and the amount of his remuneration. In practice, it may be: the legal representative, one of the partners (or the sole partner) or even a third party.
It's the the Commercial Court who appoints the liquidator during a judicial liquidation. This is a legal representative registered on an official list or of another person complying with specific criteria (nationality, diploma, experience, qualification, integrity, etc.). This procedure is therefore much more restrictive.
5. What is the main task of the liquidator?
First of all, the appointment of the liquidator has the effect of revoke the leaders in place of their social functions. It is the liquidator who embodies society and manages the latest topics. He will govern company and must sell the assets and settle the debts (See question 3). But he also has other duties.
He must, in fact, call the shareholders within 6 months of his appointment in order to take stock of the state of the company and specify the estimated deadline for completing the procedures. If the company draws up annual balance sheets in the meantime, it must draw them up and present them for consideration by the shareholders. Finally, his last tasks are to present the final liquidation accounts and to do review shareholders On the latter.
6. What is the validity period of a liquidator's mandate?
Normally the term of the liquidator does not exceed 3 years. The difference between dissolution and liquidation may also be determined by the articles of association, within a shorter period. Once this period has passed, the company runs the risk of being automatically deregistered.
However, under certain conditions, the liquidator may request a exceptional extension of his mandate. Adequate justification of the request is necessary. In addition, he has only one month to complete the mandatory legal formalities.
7. What is the process for calculating the amount of the rescission?
During liquidation operations, the balance sheet calculation and equity division are required. If the partners obtain more funds than their initial investment, it is called liquidation profit.
On the other hand, if the partners obtain an amount lower than their contribution or nothing at all, the dissolution ends with a deficit. There is a simplified technique for determining the amount of the resolution: equity – share capital.
8. What tax applies to the profit from the closing?
If the dissolution results in a perte, there is no consequence tax. In addition, the deficit cannot be deducted from the natural person partners. For associates who are legal persons (companies), there are different deduction regimes, depending on how long the securities are held.
If, on the other hand, a profit appears, dissolution may result in taxation. Indeed, the legislation provides for the payment of a 2,5% sharing fee except if the company has only one partner (SASU-EURL for example) or if the partners are legal entities. For individuals, the profit is treated as a dividend and therefore taxed accordingly.
9. What are the fees for closing a company?
In general, the only costs to be expected to close a company are the registry fees (approximately €13,93) and legal announcement (approximately €129,60). When the liquidation results in a liquidation bonus, the cost generated by the registration must also be taken into account.
Please note, these are not the only amounts involved since the dissolution also has a cost. It is estimated at around 350 €. Globally, put an end to a company generally amounts, at a minimum, to 500 €.
10. What is the process to follow to obtain a deregistration Kbis following a liquidation?
Once the liquidation operations have been completed and the liquidation accounts have been validated, the company must proceed to its radiation of the trade and companies register (RCS). To do this, she must fill out a form (M4), constitute a document set and submit the whole to the registry of the commercial court.
If the file is complete, the registry will remove the company from the RCS, send an extract Deregistration Kbis to the company and will publish an announcement in the official bulletin of civil and commercial announcements (BODACC). It will be from this moment that the company will be permanently removed from the register.
Also discover our file: Understand everything about dissolution
Q1: What is the liquidation of a company?
A1: A company liquidation is a legal process of closing the affairs of a company and distributing its assets among its creditors and shareholders.
Q2: What are the different types of liquidation?
A2: There are several types of liquidation, including voluntary liquidation, compulsory liquidation and liquidation by extinction.
Q3: What are the risks associated with liquidation?
A3: Liquidation risks can include financial losses to shareholders and creditors, legal disputes and a decline in the company's reputation.
