This article is for Irish company directors who need to close their business and want to understand which closure method is right for their situation.
If you're wondering whether to strike off your company or go through formal liquidation—and what the legal and financial consequences of each option are—this guide covers the requirements, processes, and costs for striking off, members' voluntary liquidation, and creditors' voluntary liquidation.
Key Takeaways
Striking off costs only €50 but requires no trading for three months, zero liabilities, and all assets distributed beforehand.
Any assets remaining when struck off become State property, requiring expensive court applications to recover later.
Members' voluntary liquidation costs €3,000-€10,000+ but offers tax advantages through capital gains treatment on distributions.
Directors face personal liability for reckless trading if they continue operating while knowingly insolvent under Section 610.
Administrative striking off by CRO can be restored without court if CRO-initiated; voluntary striking off requires court restoration.
What's the difference between striking off and winding up a company?
Striking off is a simple administrative process that removes a company from the register without formal liquidation, suitable for dormant companies with no assets or liabilities. Winding up involves formal liquidation procedures where a liquidator takes control, realizes assets, pays creditors, and distributes any surplus to shareholders before dissolution.
Can I strike off my company if it still has assets or owes money?
No, your company must have no outstanding liabilities to creditors, Revenue, or other parties, and must have disposed of all assets or transferred them to shareholders before applying for striking off. If these conditions aren't met, striking off is inappropriate and could create director liability.
What happens to my company's assets if I strike it off without distributing them first?
Any assets remaining when a company is struck off become State property. Recovering those assets later requires expensive court applications and legal costs, so you should transfer all assets to shareholders or third parties before applying for striking off.
How much does it cost to close my company through striking off versus liquidation?
Striking off costs just €50 for the CRO filing fee, making it the cheapest closure method. Members' voluntary liquidation typically costs €3,000-€10,000+ depending on company complexity, asset values, and liquidator fees, though it may provide tax benefits that justify the additional cost.
What is administrative striking off and how can I prevent it?
Administrative striking off occurs when the CRO removes companies that fail to file annual returns for two consecutive years, fail to pay required fees, or appear to no longer be trading. If you receive a striking off notice from the CRO, file outstanding returns immediately and contact the CRO to prevent the striking off from proceeding.
When should I use Members' Voluntary Liquidation instead of striking off?
Use MVL when your solvent company has significant assets to distribute to shareholders and you want potential tax advantages. Capital gains tax treatment may apply to distributions rather than higher income tax rates, and MVL provides comprehensive legal closure with proper asset distribution according to shareholder rights.
Do I need Creditors' Voluntary Liquidation if my company can't pay its debts?
Yes, creditors' voluntary liquidation is required when your company cannot pay debts as they fall due and continuing to trade would be reckless. This process protects you from personal liability for reckless trading, which can make directors personally liable for company debts if they continue trading while knowingly insolvent.
What happens if I don't cooperate with the liquidator during winding up?
Failure to cooperate fully with the liquidator—including providing all company books and records, attending meetings, and answering questions truthfully—can result in restriction orders under Section 819. These orders prevent you from serving as a director of other companies for five years without court permission.
Can I restore my company to the register after it's been struck off?
Yes, struck off companies can be restored through administrative restoration via the CRO (if the strike-off was CRO-initiated) or by court order (if the company was voluntarily struck off). Administrative restoration is relatively straightforward and low-cost, while court restoration typically involves legal representation and higher costs.
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