People often ask me how to go about closing a private company and what their responsibilities are. CONTACT US FOR MORE INFO…
The first thing to consider when closing a company is the tax implications. All taxes must be submitted and paid up to date, right up to the date that the company ceased to trade. This is applicable to all tax types.
Income tax – Financial statements have to be prepared up to the date the company stopped trading. An IT14 return should then be submitted to SARS. If the company stopped trading in the middle of the financial year, financial statements must still be compiled, for all the months there were transactions in the company.
Employee tax (PAYE) – All PAYE returns(EMP201’s) have to be submitted. An employee tax reconciliation must also be completed. The IRP5’s must then be handed to all employees.
VAT – All VAT returns up to the date that trading ceased must be submitted.
All other taxes like dividends tax or capital gains should also be submitted to SARS.
Once all taxes are submitted and paid up to date, a tax clearance can be generated. After that, a request is sent to SARS to deregister the tax types.
UIF and Workmen’s Compensation – All outstanding returns should be submitted to department of labour. Both the UIF and Workmen’s compensation also have to be deregistered.
CIPC – After all the tax types have been deregistered, a request can be sent to CIPC to deregister the company. They will need the proof that all the taxes have been submitted and paid.
If you have a company that has never traded, i.e has been dormant for however long period, the income tax must still be submitted. It will be indicated on the IT14 that the company has been dormant.
The information provided above, only relates to procedures at SARS, CIPC and the department of labour. If the company has any other debt, finance agreements with financial institutions or suppliers, or court judgements, these will have to be dealt with before the company can be deregistered,