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DEREGISTRATION OF HONG KONG COMPANY
Deregistration of a Hong Kong Company is the process of removing a company from the official register maintained by the Companies Registry in Hong Kong. This means that the company is dissolved and no longer exists as a legal entity.
Some of the main reasons leading to deregistration include the following.
- The company is no longer needed or has served its purpose.
- The company’s shareholders have decided to dissolve the company voluntarily.
- The company has not carried out any significant transactions or activities for a prolonged period and has no assets or liabilities.
- The company has been dissolved or wound up and has settled all debts and liabilities.
- The company is facing legal action or investigations by regulatory bodies.
Winding up is another method for dissolving a company. It involves appointing a liquidator who is responsible for setting the company’s obligations, liquidating assets, and distributing the net assets to shareholders, ensuring that the company is dissolved. This process is more complex and can take more time and money than deregistration.
Striking off is a method in which the company’s name is removed from the Companies Register by the Registrar of Companies. This occurs when a company is no longer operating or conducting business. The company cannot file a strike-off application on its own, and it will be dissolved once its name is removed from the register. It’s less common than deregistration and winding up because it can only be done by the Registrar and not by the company.
It’s advisable to consult a professional firm such as Relin Consultants or the Companies Registry to understand the process and consequences of each method and determine the best course of action for your company.
WHAT TYPES OF COMPANIES MAY APPLY FOR DEREGISTER COMPANY IN HK?
Companies that are eligible for deregistration in Hong Kong include private companies and companies limited by guarantee that are dormant, solvent, and have no outstanding liabilities.
These are companies that have not carried out any significant transactions or activities for a prolonged period and have no assets or liabilities.
However, certain types of companies are not entitled to apply for deregistration, including public companies, banks, insurance companies, trust companies, and their holding companies during the five years immediately before the deregistration application is made.
Registered non-Hong Kong companies under Part 16 of the Companies Ordinance are not eligible to apply.
A private company must be a defunct and solvent company, meaning it is no longer operating and has no debts or liabilities.
Companies that fall under any of the 8 categories listed in section 749 (2) of the Companies Ordinance are not eligible for deregistration. These categories include authorized institutions, insurers, regulated corporations, approved trustees, and companies with subsidiaries in these categories.
Companies that fall under these categories at any time during the five years immediately before the application for deregistration is made are also not eligible to apply.
STEPS TO DEREGISTER YOUR COMPANY IN HONG KONG
Step 1: Clear all assets and liabilities of the company
- Cease the holding relationship with other companies if the company is a holding company.
- Dispose of any assets such as stock, machines, motor vehicles, land, and property.
- Clear the balances in bank accounts and close the accounts.
- Settle all outstanding debts or have them waived by creditors.
Step 2: Obtain a Notice of No Objection from the Commissioner of the Inland Revenue Department (IRD)
- Clear all outstanding tax issues, such as profits tax returns, business registration fees, and offshore claims.
- Pay all necessary taxes to the IRD.
- Prepare final accounts from the last set of audited financial statements up to the business cessation date and submit them to the IRD.
- To apply for a “Notice of No Objection,” you must complete a Notice of No Objection to a Company Being Deregistered (Form IR1263).
Step 3: Submit the application for deregistration to the Registrar of Companies
- Deliver the application, required fee, and Notice of No Objection to the Registrar of Companies within 3 months of receiving the Notice of No Objection.
- Receive an acknowledgment notice within 5 working days.
- Wait for the Registrar to publish a notice of proposed deregistration in the Gazette.
- To submit a completed application for deregistration of a Private Company or Company Limited by Guarantee (Form NDR1), as well as a mandatory payment of HK$420.
Step 4: Wait for the deregistration process
- If no objections are received within 3 months, the Registrar will deregister the company by publishing a second notice in the Gazette.
- The company will be dissolved on deregistration and the process takes about 5 months.
- You will receive a separate letter from the Registrar of Companies to inform you of the company’s deregistration.
Step 5: Notify other government departments and regulatory bodies
- Notify the Inland Revenue Department and other relevant government departments of the company’s deregistration.
- Return any licenses and permits held by the company to the relevant government department or regulatory body.
WHY CHOOSE RELIN CONSULTANTS TO DEREGISTER A HONG KONG COMPANY?
Hiring a professional firm like Relin Consultants for the deregistration of your Hong Kong company can provide several benefits.
Expertise and knowledge: Relin Consultants has a team of experienced professionals who are well-versed in the Companies Ordinance and the deregistration process. They can provide accurate and up-to-date guidance and advice on all aspects of the deregistration process, ensuring compliance with all legal requirements.
Time-saving: Engaging Relin Consultants can save you time and effort by handling the entire deregistration process for you, from preparing the necessary documents to applying with the Companies Registry.
Cost-effective: Hiring Relin Consultants can help you avoid costly mistakes and ensure that the deregistration process is completed efficiently and effectively, saving you time and money.
Tailored service: Relin Consultants offers tailored service to meet the specific needs of each client. They will work closely with you to understand your unique circumstances and provide a customized solution that suits your needs.
One-stop service: Relin Consultants offers a one-stop service, which includes not only deregistration but also other related services such as accounting, auditing, and secretarial.
What are the mandatory requirements that must be fulfilled before applying for the deregistration of a Hong Kong company?
Before applying for the deregistration of your Hong Kong company, you must comply with the following requirements:
- All company members must approve the deregistration.
- The company will not participate in any legal procedures.
- The company does not own any immovable property in Hong Kong.
- There are no outstanding obligations or liabilities.
- There has been no activity or business in the three months before the application for deregistration.
- In the case of a holding company, none of its subsidiary’s assets are based in Hong Kong.
- The Commissioner of Inland Revenue has delivered a “Notice of No Objection to a Company Being Deregistered” (or simply “Notice of No Objection”) to the company.
What are some of the key considerations that I should take note of when deregistering a Hong Kong company?
When deregistering a Hong Kong company, there are several key considerations to keep in mind:
Company property disposal: Before deregistering, ensure that all company property, including bank balances, real property, and vehicles, have been properly disposed of. According to Hong Kong legislation, all company property must be regarded as ‘bona vacant and will be kept by the Hong Kong Government’s Special Administrative Region upon the company’s closure.
Annual report obligations: Until the company is officially deregistered, it must continue to meet all compliance obligations under the Companies Ordinance, including completing annual returns and informing the Companies Registry of any changes to the company’s registered office address and company secretary and director information.
Tax clearance: Obtain a Notice of No Objection from the Inland Revenue Department (IRD), which serves as a tax clearance certificate, by submitting the company’s final accounts from the last set of audited financial statements up to the business cessation date and ensuring that all taxes and other fees have been paid.
Outstanding debts and liabilities: Ensure that creditors have settled or waived all outstanding debts and liabilities before deregistering the company. This includes outstanding loans, taxes, employee salaries, and other obligations.
Notification: Notify the Inland Revenue Department, other relevant government departments, and regulatory bodies of the company’s deregistration and return.
How long would it take for my Hong Kong company to be properly deregistered?
The time it takes to deregister a company in Hong Kong can vary depending on the complexity of the case and the completeness of the application. However, in general, the process can take around 5 months.
What are the common fees for the deregistration of a Hong Kong company?
The fees for deregistering a Hong Kong company can vary depending on the specific circumstances of the case and the type of company. However, in general, the following fees are commonly associated with the deregistration of a Hong Kong company:
Application fee: A fee must be paid when submitting an application for deregistration to the Companies Registry. This fee varies depending on the type of company and can range from a few hundred to a few thousand Hong Kong dollars.
Gazette fee: A fee is required to be paid for publishing a notice of the proposed deregistration in the Gazette, which is a government publication that announces official government decisions and legal notices.
Tax clearance fee: A fee may be required to be paid when obtaining a Notice of No Objection from the Inland Revenue Department (IRD) for tax clearance.
Audit fee: A fee may be required to be paid for an audit of the company’s final accounts, which is required for tax clearance and to provide the details of the company’s financial position.
Legal fees: If you are engaging a lawyer or solicitor to assist with the deregistration process, a legal fee will be charged.
It’s important to note that these fees may vary depending on the specific circumstances of the case and the type of company. It’s recommended to consult with the Companies Registry or a professional firm for an estimate of the fees that will be incurred in the deregistration process.
Can I restore my company once it has been deregistered?
It is possible to restore a Hong Kong company that has been deregistered, but it is subject to the approval of the Companies Registry and the fulfillment of certain requirements. The process for restoring a deregistered company is known as “reinstatement.”
The process may take several weeks and will require the submission of various forms and documentation, including financial statements and proof that the company’s liabilities have been settled. Additionally, the company will likely need to pay fees associated with the reinstatement process. It is best to consult with a lawyer or professional in Hong Kong familiar with company law to understand the specific requirements and process for reinstating a deregistered company.
How long would it take to restore my deregistered company?
The time it takes to restore a deregistered company in Hong Kong can vary depending on the specific circumstances of the case and the completeness of the documentation submitted. Typically, the process of reinstating a deregistered company in Hong Kong can take several weeks.
The Companies Registry will first need to review the application and supporting documents to ensure that all the requirements have been met. Once the application is approved, the company will be restored to the register, and a certificate of reinstatement will be issued.
It’s important to note that the time frame can vary depending on the workload of the Companies Registry and other factors, and it’s also possible that the application can be rejected.
The restoration of a deregistered company usually takes around two months.