Allowing a company "to die"

J

jokerini

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XYZ Limited has not filed a set of audited accounts with CRO since 30 September 2012. The company status is "normal" according to the CRO website. The company ceased trading recently. The company has no assets and the only creditor is the Mr A, the director and sole shareholder. He doesn't want to pay an accountant to prepare accounts to cessation and pay CRO late-filing penalties. Can he get away with burying his head in the sand and letting CRO involuntarily strike-off the company? Mr A wishes then wishes to become a sole trader as he is tired of the additional paperwork involved with running a company. Is anything stopping him from taking this approach?
 
Sorry to butt in but some one may be able to help me here
My husband and his business partner wound up their company in 2012 ( 2 directors / ltd company)
I am not sure if they contacted the CRO but will check
the revenue have now sent a demand for unpaid taxes from 2011 and 2012 to my husband.
The company closed and is no longer operational
Is he liable at this stage?
The company had no assets and was no longer viable.
They had an accountant at the time so this demand has come as a shock
Its not a huge amount ( 7k euro ) but he does not have it.
any advice
k
 
All outstanding issues should have been addressed by the accountant at the time the company was dissolved. A declaration of solvency would have been signed by the directors to the effect that there were no outstanding unpaid creditors. The involvement of an accountant would not absolve any documentation completed incorrectly. I suggest that you contact the accountant to establish why this was not addressed during the dissolution process. There may be an issue of personal liability if the company dissolution was not completed correctly. However you will get more accurate advice from your accountant.
 
Thanks for the response to my original query. However, I was under the impression that the CRO can unilaterally strike off a company if a return is late. On CRO website, it mentions the serious consequences of being struck-off e.g. assets becoming property of state, loss of limited liability, disqualification of director.

In my example above, Mr A does not care if CRO struck off the company as it is dormant. It has no assets, the only creditor is himself and he intends to become a sole trader. Therefore, he couldn't care less about the "dire consequences" of CRO strike-off. My point is that it seems cheaper to let a company die than to do the "right thing" by preparing accounts to cessation and pay late CRO fees (minimum €1,200).
 
kmce said:
Sorry to butt in but some one may be able to help me here
My husband and his business partner wound up their company in 2012 ( 2 directors / ltd company)
I am not sure if they contacted the CRO but will check
the revenue have now sent a demand for unpaid taxes from 2011 and 2012 to my husband.
The company closed and is no longer operational
Is he liable at this stage?
The company had no assets and was no longer viable.
They had an accountant at the time so this demand has come as a shock
Its not a huge amount ( 7k euro ) but he does not have it.
any advice
k
Click to expand...
It is most likely PAYE/PRSI that the company owed in respect of salaries paid to your OH and his partner?
If the company pays its director a salary of 50k gross, so say 35k net, then it owes the 15k in taxes it has deducted. If it doesn't pay the 15k then the director is not entitled to any credit for this tax withheld.
So he may have received an amended income tax assessment with (say) the 50k of income on it, but with no credit for the tax deducted but not remitted by the company.
 
thanks Jon Snow - thats what happened - thank you for taking the time to reply
kind rgds
k
 
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