Voluntary Strike-Off is the formal process where company directors can apply to have their company removed from the official register, effectively dissolving the company when it's no longer needed or operational.
A voluntary strike-off is a legal process initiated by company directors to formally dissolve and remove a company from the Companies Registration Office (CRO) register when the company is no longer trading, solvent, and has no outstanding liabilities.
Voluntary strike-off is the formal mechanism through which directors can apply to have their company removed from the official register maintained by the Companies Registration Office. This process effectively dissolves the company's legal existence, meaning it can no longer trade, enter into contracts, or incur liabilities. It is the most straightforward way to close a company that has served its purpose or is no longer viable, provided it meets strict eligibility criteria.
When you initiate voluntary strike-off, you are formally notifying the CRO that your company has ceased trading and holds no significant assets or liabilities. This differs from compulsory strike-off, which is initiated by the CRO when a company fails to meet its statutory obligations. Voluntary strike-off puts you in control of the dissolution timeline and process, allowing for a more orderly wind-down of your company's affairs.
The voluntary strike-off process requires careful preparation and compliance with specific legal requirements. You must ensure all outstanding tax returns are filed, all creditors are settled, and the company's assets are properly distributed before submitting your application. Failure to meet these conditions can result in objections from creditors or regulatory bodies, potentially delaying or preventing the strike-off.
You would typically choose voluntary strike-off when your company has ceased trading and has no significant assets or liabilities to address. This situation often arises when a business idea didn't progress as planned, when founders decide to pursue other opportunities, or when a subsidiary company is no longer needed. Voluntary strike-off offers a cost-effective alternative to formal liquidation, which can be more expensive and time-consuming for solvent companies with simple affairs.
Another common reason for choosing voluntary strike-off is administrative convenience. Maintaining a dormant company still requires annual filings with the Companies Registration Office and potentially annual returns to Revenue. These ongoing compliance obligations incur costs and administrative burden, which voluntary strike-off eliminates. For many founders, it makes financial sense to dissolve a company that is no longer active rather than paying ongoing maintenance fees.
To qualify for voluntary strike-off in Ireland, your company must meet several specific conditions set out in the Companies Act 2014. First and foremost, the company must not have traded or conducted any business in the three months preceding the application. This includes ceasing all commercial activities, though you may still undertake administrative tasks necessary for the strike-off process itself.
Your company must also have no outstanding liabilities, meaning all creditors must be paid in full or have consented to the strike-off. This includes tax obligations to Revenue, outstanding loans, supplier invoices, and any other financial commitments. Additionally, the company must have no assets remaining, or if it does have assets, these must be distributed to shareholders before applying for strike-off, which may have tax implications that you should consider.
The company must not be involved in any legal proceedings, either as a plaintiff or defendant, and must not be subject to any winding-up resolution or insolvency proceedings. All directors must agree to the strike-off, and the company must have filed all necessary annual returns and financial statements with the Companies Registration Office up to the date of application.
The voluntary strike-off process begins with a formal resolution by the company's directors to apply for strike-off. This resolution should be documented in the company's minute book. Once the directors have resolved to proceed, you must publish a notice of the intended strike-off in Iris Oifigiúil, the official state gazette, and in one daily newspaper circulating in the district where the company's registered office is located.
After publishing the required notices, you submit Form H15 to the Companies Registration Office along with the prescribed fee. This form includes declarations that the company meets all eligibility criteria for strike-off. The CRO will then publish a notice of the strike-off application on its website, starting a three-month objection period during which creditors or other interested parties can object to the company's removal from the register.
If no objections are received during the three-month period, the CRO will proceed to strike the company off the register. You will receive formal notification of the strike-off, and the company will be dissolved. Once dissolved, the company ceases to exist as a legal entity, and its name becomes available for use by other companies after a certain period.
If your company does not qualify for voluntary strike-off because it has significant assets, liabilities, or ongoing operations, you may need to consider formal liquidation. Members' voluntary liquidation is appropriate for solvent companies with assets to distribute, while creditors' voluntary liquidation is for insolvent companies. These processes are more complex and expensive than voluntary strike-off but provide a structured framework for addressing creditor claims and distributing remaining assets.
Another alternative is to maintain the company as dormant, which involves filing dormant company accounts with the Companies Registration Office each year. This approach preserves the company's legal existence and name for potential future use but requires ongoing compliance and maintenance fees. For some founders, keeping a company dormant makes sense if they anticipate reviving the business or if the company holds valuable intellectual property or contracts that might be useful later.
You might also consider a company change of registered office to a more cost-effective address if the main concern is reducing ongoing expenses rather than dissolving the company entirely. This can be particularly relevant if you plan to reactivate the company in the future or if dissolution would trigger undesirable tax consequences.
Once voluntary strike-off is complete and your company is removed from the register, it ceases to exist as a legal entity. This means it can no longer enter into contracts, own property, or conduct business. Any assets that were not properly distributed before strike-off become bona vacantia (ownerless property) and pass to the State. For this reason, it is crucial to properly distribute all company assets before submitting your strike-off application.
Directors and shareholders are generally released from their obligations to the company once strike-off is complete, provided all legal requirements were met during the process. However, if it is later discovered that the company had outstanding liabilities or that the directors provided false information in the strike-off application, they could face personal liability or legal consequences. The CRO has the power to restore a company to the register within 12 months of strike-off if proper procedures were not followed.
After strike-off, you should inform all relevant parties of the company's dissolution, including banks, suppliers, customers, and professional advisors. You should also retain company records for the statutory retention period, which is typically six years from the date of dissolution. These records may be needed if the company is restored to the register or if questions arise about its former operations.
