Procedures on De-registration and Liquidation in Australia

What are  the necessary procedures for dissolving a foreign-owned subsidiary in Australia?What are the documents that need to be submitted to the tax office when dissolving a company in Australia ?

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Australia CA Lily Yan, speak both English and Chinese
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Country-wise procedures of dissolution liquidation for foreigner-owned company

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What is the logic behind the deregistration and liquidation process of a foreign-owned company in Australia?
The dissolution and liquidation procedures in each country may seem very complicated and difficult to understand at first glance.

When a foreign-owned company is established in Australia, it needs to register with the Australian Securities and Investments Commission (ASIC).
After the company is established, obtains an Australian Company Number (ACN), which is a unique identification number used for financial transactions and regulatory reporting.
In contrast, when you decide to close your company, you also need to declare it to the Australian Securities and Investments Commission (ASIC).
After the approval of the Australian Securities and Investments Commission (ASIC),
Register for tax with the Australian Tax Officer (ATO) and obtain an income tax number.
Then apply for GST number from the Australian Tax Officer (ATO).
Depending on the nature of your business, you may need to obtain a business license or permit for your specific business.
Finally, you need to obtain a Fringe benefits Tax (FBT) account and pay as you go (PAYG), superannuation from the Australian Tax Officer (ATO),
and finally open a bank account.

Conversely, when closing a business,
Report the company’s liquidation to the Australian Tax Officer (ATO) and complete the relevant tax procedures.
Finally, the relevant agencies need to be notified to cancel the income tax number, the GST number, the business license or permit for the specific business, the social insurance number of the employee, and the cancellation of the bank account.

In addition to the cancellation of various certificate numbers, when a foreign-funded company is dissolved, it is necessary to appoint a Liquidator to supervise the procedure, evaluate and value the company’s assets and liabilities, pay off outstanding debts and obligations, and sell the company’s assets, according to Statutory priorities distribute proceeds of sale to creditors and shareholders.

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What are the necessary procedures for dissolving a foreign-owned subsidiary in Australia?

1. Declaration of solvency:
   • The majority of the directors must make a Declaration of solvency (Form 520) to prove their ability to pay all debts within 12 months of the commencement of the winding up.
   • Form 520 must be made and lodged with ASIC (Australian Securities and Investments Commission). This must be done before the date on which the notice of meeting is sent to members.
2. Pass a special resolution:
   • After the solvency declaration has been lodged, the company members must pass a special resolution to wind up the company.
   • At least 75% of company members must pass the resolution.
   • The company must lodge Form 205 Notification of resolution setting out the text of the resolution that was passed.
3. Appointment of liquidator
   • The liquidator must lodge Form 505 Notification of appointment or cessation of an external administrator to advise of their appointment.
4. Published on the website.
   • Notice of the resolution to wind up the company must be published on ASIC’s Published notices website by the end of the next business day after the liquidator is appointed.
   • https://publishednotices.asic.gov.au/
5. Clear Debts and Liabilities:
   • The liquidator begins winding up the company. They must lodge with ASIC a detailed list of receipts and payments for the administration (Form 5602 Annual Administration Return) annually on the anniversary of their appointment.
6. File the Final Tax Returns and GST:
   • Liquidator should notify the ATO of their appointment and the company’s intention to enter into liquidation. This can typically be done by sending a formal notice to the ATO.
   • It is not necessary to prepare financial statements up until the date of liquidation. The liquidator will send you a Notice require you to deliver the company’s books and records, usually within 2 weeks of the date of liquidation.
   • The company must ensure that all outstanding tax returns, including Business Activity Statement (BAS) and Income Tax Returns, are up to date. The liquidator is responsible for preparing and lodge these returns on behalf of the company.
   • The liquidator must prioritize the payment of any outstanding tax debts to the ATO. This includes income tax and GST.
   • Before the liquidation process is completed, the company must obtain a Tax Clearance Certificate from the ATO.
7. Final pay for superannuation for employees:
   • Finalize and lodge your Fridge benefits Tax (FBT) return if you’re registered for FBT, pay as you go (PAYG), superannuation.
8. ASIC Deregistration:
   • If the liquidator has finished winding up the company before 1 July 2018, they need to lodge Form 523 Notification of final meeting convened by liquidators within 7 days of the company’s final meeting. It must include an account of how the winding up was conducted.
   • The liquidator must also lodge a:
   o Form 5603 End of administration return
   o Form 5011 Copy of minutes of meeting
   • If the winding up finished on or after 1 July 218, the liquidator is not required to convene a final meeting but must lodge Form 5603 End of administration return within 1 month after the end of the winding up.
   • The company will be deregistered 3 months after Form 523 or Form 5603 has been lodged.
   

   Submit

   https://asic.gov.au/for-business/closing-your-company/deregistration/winding-up-a-solvent-company/

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What are the documents that need to be submitted to the tax office and other government competent units when dissolving a company in Australia?
When dissolving a company in Australia, there are specific documents that need to be submitted to the government units.
These documents are important to ensure that all matters are properly addressed as part of the dissolution process.
Here are some of the key documents that may need to be submitted:

1 ASIC (Australian Securities and Investments Commission)
• Declaration of solvency (Form 520)
2 ASIC (Australian Securities and Investments Commission)
• Form 205 Notification of resolution
3 ASIC (Australian Securities and Investments Commission)
• Form 505 Notification of appointment or cessation of an external administrator
5 ASIC (Australian Securities and Investments Commission)
• Form 5602 Annual Administration Return
6 Australian Tax Officer (ATO)
• Business Activity Statement (BAS), Income Tax Returns and GST returns and final settlement.
7 Australian Tax Officer (ATO)
• Lodge final Fridge benefits Tax (FBT) return, pay as you go (PAYG), superannuation returns and final settlement.
8 ASIC (Australian Securities and Investments Commission)
• Form 523 Notification of final meeting convened by liquidators.
• Form 5603 End of administration return
• Form 5011 Copy of minutes of meeting

Country-wise procedures of dissolution liquidation for foreigner-owned company

*** 
Version 2023/10/31
***
Based on  our  real service experiences plus digesting  study result  from several  web-pages  about this topic,  above contents just for your references.
Law and Regulations might be changed as following by time.
Please check with your trust-able professionals   or contact us  for verifying before  making decision.
***
We welcome your informing us if above contents need to be revised.
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