2 Ways to Close Down a Company

There could be many reasons why someone would want to close down a company. Here are some of them:

To incorporate a new company, it’s easy and as fast as 1 day, however closing down a company takes a longer process. There are 2 ways to close down a company, Strike Off and Wind Up.

Strike OffWind Up
CostRM 2,500RM 10,000 – RM 20,000
LHDN Income TaxAll outstanding tax must be settled.All outstanding tax must be settled.
LHDN Tax Clearance LetterMust obtain.
(Except Dormant)
Must obtain.
Duration needed by SSMMin. 6 monthsMin. 12 months
Balance SheetMust have no Assets & Liabilities.Complex process.
LimitationsMay be reinstated within 7 years from date of strike off.Officially terminated upon notice of confirmation.
Quick comparison between Strike Off vs Wind Up Company

Method 1: Strike Off a Company

Method 2: Wind Up a Company

TypeMembers’ VoluntaryCreditors’ VoluntaryCompulsory
Statuscompany is solvent and able to pay all its debtscompany is insolvent and unable to pay all its debtsby court order
Initiated byCompany Directors / ShareholdersCompany Directors / ShareholdersCreditors
Types of Winding Up

Common Questions

Do I still need to pay for Company Secretary ?

Yes, a Company Secretary is still required until the company is officially struck off or wound up. You can also save up to 70% on the Company Secretary fees on Boss Boleh while waiting for LHDN to provide you the necessary documents and SSM to process.

I have decided to stop my business now, can I strike off immediately ?

Your audited financial statement shall show that there is no Assets and Liabilities left. It is also important that the company does not have any profits or be in operation. Then you may proceed to strike off.

What if there’s no Assets and Liabilities but there are Retained Earnings ?

SSM may reject your application to strike off.

Will the Director / Shareholder automatically be bankrupt or blacklisted upon Striking Off / Winding Up ?

No, they will not be bankrupt or blacklisted. However, SSM has the right to submit to court to blacklist the Director if found to have breached the Companies Act 2016.

What happens when Director declares bankrupt (due to other personal reasons) while Winding Up is in process ?

The Director General of Insolvency (Liquidator) will take over and handle it. So, there is nothing to be done.

For more information, get in touch with us.

WhatsApp @018-767 8055