I’m often asked How can I close or shut down my IBC?
Whilst you could, if legal circumstances require it, go down the path of a Formal Liquidation or Winding Up Application (eg if you are owed money by the Company and want to claim priority of payment over other creditors – you should seek legal and/or accounting advice to determine whether it’s in your best interests to proceed that way) the most simple way to bring an IBC to a close is to not pay the annual renewal fees for the company in which case its registration will lapse. It depends on the jurisdiction but generally speaking come 31 December of the current year it will be struck from the register (though it can be restored, depending on the jurisdiction, up to 10 years subsequent to that date).
A formal winding up or liquidation may give you priority of payment if you are an unsecured creditor of the company and there are creditors pressing, no secured creditors, and not enough funds to pay all the creditors.
To dissolve an IBC it is necessary to issue a Resolution of Dissolution signed by the director(s) of the company. The procedure of dissolution usually takes from 1.5 to 2 months provided that the company does not have any assets which must be attributed to the shareholders, and no debt obligations or other liabilities.
Thus if an IBC does not have any assets or liabilities, it will have to submit:
1. Bank statements
2. A Declaration signed by the directors of the company and confirming that the company does not have any assets or liabilities
3. Resolution of Dissolution signed by the director(s) of the company.
In the case when the company had business transactions and maintained financial records, it will have to provide financial statements, returns, and other documents confirming the financial position of the company at the time of dissolution.
The above documents must be sent to the Company’s Registered Agent, who will prepare Articles of Dissolution, publish a note in a local newspaper and then register the winding up with the authorities. After that the Registrar will issue a Certificate of Dissolution.
Lawyers would have to be briefed at a similar cost to what you would pay in the UK etc for the same legal procedure. Estimated cost is circa $US1,500 -2,000.
Note also the company should be in good standing to apply for liquidation and any unpaid annual renewal fees will need to be met before the procedure can begin.
To close the IBC’s bank account usually entails the Company Manager and or Account Signatory advising the Bank of that request in a written communication to the bank + details of where you want excess funds to go.
