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Close the company

Compass Services

Closing a Company: A Comprehensive Guide to Legally Winding Up a Business in Hong Kong

When a company has fulfilled its historical mission or needs to cease operations, ‘winding up a company’ (also known as company liquidation) is a formal and comprehensive legal procedure. This procedure mainly applies to companies with assets or liabilities. Through statutory liquidation processes, the company’s assets are realized, debts are settled, and any remaining property is distributed to shareholders, after which the company is officially dissolved. The professional team at Compass Accounting is well-versed in the Companies (Winding Up and Miscellaneous Provisions) Ordinance and provides compliant and efficient liquidation solutions, ensuring that the process is legal and regulated while protecting the rights and interests of directors and shareholders.

Company Deregistration: A Simple Legal Path to Close a Company​
Company deregistration is a convenient method to close a company as stipulated by Hong Kong law. It refers to the process where a company that meets specific criteria, upon unanimous consent of all shareholders and approval from relevant government departments, is removed from the official register of the Companies Registry, terminating its legal person status.​​
​​Its core characteristics are:​
​​​      Simple procedure: No court involvement or appointment of a professional liquidator is required, saving time and costs;
      ​​​ Applicable only to companies with no assets, no debts, and no potential legal risks;
​​​       If there are undiscovered creditors after deregistration, the company’s registration can be restored under specific conditions to protect the legitimate rights and interests of creditors.
Eligibility Criteria for Deregistration (Pursuant to Section 749 of the Companies Ordinance)
To close a company through deregistration, all of the following conditions must be met simultaneously:
  1. Company nature: Must be a private company and not a holding company controlling real estate;
  2. Shareholder consensus: All shareholders unanimously pass the deregistration resolution without any objections;
  3. Operational status: Has ceased operations for more than three months or has never started operations since registration;
  4. Financial status: All assets have been fully realized and disposed of, all debts have been completely settled, and there are no outstanding payments;
  5. Compliance status: No pending litigation, tax inquiries, tax arrears, or government fines;
  6. Legal obligations: Has fulfilled all statutory declaration obligations, such as annual tax filing and annual return submission.
Legal procedure for dissolving a company

Preparations

Convene a shareholders' meeting to pass the deregistration resolution; liquidate assets, terminate business relationships, organize compliance documents

Apply to IRD

Submit "No Objection Letter" deregistration application and supporting documents; obtain the letter after paying tax arrears

Submit to Companies Registry

Prepare and submit materials; the Registry issues an acceptance notice within 5 working days after review, and publishes a gazette notice

Await Objection Period

After 3 months of no objections, the Registry publishes the final deregistration notice upon the end of the objection period

Cancel Business Registration

Submit an application to the Hong Kong Business Registration Office within one month after deregistration by the Registry to complete the cancellation process

Service Inquiry & Quotation

Tel：+852 9261 3400
Or Email：info@accolink.co

FAQ
Can a company with outstanding tax fines close through deregistration?

Answer: No. All tax fines must be paid in full, and unfiled tax returns must be supplemented before confirming no tax arrears to apply for deregistration.

If shareholders cannot reach a consensus, can one party unilaterally apply for deregistration to close the company?

Answer: No. Closing a company through deregistration requires the unanimous consent of all shareholders. If any shareholder objects, the deregistration process cannot be initiated.

After the company is closed through deregistration, what should be done if unpaid claims are discovered?

Answer: After deregistration, the company's legal person status is terminated, and it cannot pursue claims in the company's name. It is recommended to thoroughly clear accounts receivable before closing the company to ensure all claims are realized or disposed of.

Will an expired business registration certificate affect the deregistration application?

Answer: If the expiration is due to the company having ceased operations and there are no unpaid business registration fees, it will not be affected; if there are unpaid fees, they must be paid first before applying for deregistration.

Can the deregistration application be withdrawn after submission?

Answer: Before the Companies Registry publishes the final deregistration notice, a withdrawal application can be submitted to the registry. After approval, the deregistration process will be terminated, and the company can resume normal status.

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