Opting for voluntary company liquidation in SAIF Zone allows business owners to close down their company legally, fulfilling the interests of all the stakeholders involved. Many entrepreneurs choose to abandon their company and leave the country when they find it hard to run their business smoothly. Instead of opting for such illegal options, business owners can apply for voluntary company liquidation in the UAE which is one of the best exit strategies.
The process of company liquidation involves a series of steps and compliance requirements for which you can appoint experienced company liquidators in Sharjah. Companies under liquidation, nowadays, are also required to meet regulatory compliance requirements related to Economic Substance Regulations (ESR), Ultimate Beneficial Ownership (UBO) and Value Added Tax (VAT). The following article will equip you with the necessary information on the latest steps and requirements to wind up a company in SAIF Zone:
Board Resolution for Liquidation
The process of company liquidation in SAIF Zone begins with the directors of the firm passing a resolution to shut down the business. The board resolution must be signed by all the directors of the company. The resolution should also state the reasons for closure which can include adverse market conditions, cash flow / financial difficulties, change of business strategies, high cost/cost cutting, loss / less profitable business, no business activity, operations difficulty, achievement of business objective etc.
Appointment of Company Liquidator
An audit firm licensed to operate in the UAE must be appointed as the company’s liquidator. The liquidator will be in charge of overseeing the winding up of the company in the SAIF Zone. The powers of the directors will cease once the liquidator assumes his responsibilities.
Liquidator’s Letter to the Authority
Once appointed, the liquidator is required to officially express his willingness to carry out the company’s liquidation in SAIF Zone. Company liquidators in Sharjah must send a letter to the Free Zone Authority confirming the appointment.
Cancellation of Visas
You need to submit a visa status report to show that all the visas issued under the company’s name have been cancelled. You must also cancel all the ID cards and Immigration cards under the company’s name.
Bank Account Closure
The bank account of the company must be cancelled before winding up a company in SAIF Zone. You need to obtain an account closure letter from your bank to show the account has been closed.
Clearance from Authorities & Service Providers
You must obtain clearance letters from government authorities and utility service providers for the closure of SAIF Zone companies. Company liquidators in Sharjah can guide you further on this. You must obtain clearance letters from the following entities:
- Sharjah Customs
- Emirates Post
- SAIF Zone Facilities Management
Return of the Keys
The keys to the premises rented by the company must be returned to the Leasing, Licensing & Legal Department of the free zone. You need to obtain a clearance letter from them after handing over the keys.
Settlement of Outstanding Payments
You must settle all the outstanding payments with SAIF ZONE’s Finance & Accounts Department. This will include the overstay charges until the date of cancellation of all the visas and handing over the keys of premises (whichever is later).
Hand Over Original Documents
You need to return the original documents to the authority that were issued at the time of your company’s incorporation into the SAIF Zone. The documents include License, Tenancy Contract, Memorandum & Articles of Association, Investment Service Agreement, Share Certificate, Certificate of Incorporation etc. These certificates must be returned to the department of Leasing, Licensing & Legal Affairs.
You must publish an advertisement about the liquidation in Arabic and English newspapers. It will be followed by a grace period of 15 days during which creditors or other parties can raise any claim. The SAIF Zone Authority will not entertain any claim made after the lock-in period.
Apply for VAT Deregistration
VAT registrant companies undergoing liquidation in SAIF Zone must apply for deregistration within 20 days of the cessation. The Federal Tax Authority (FTA) will impose a fine of AED 10,000 on companies that violate this mandatory requirement. Company liquidators in Sharjah suggest business owners meet this requirement without fail otherwise you will face delays and penalties while shutting down the firm.
Meet Economic Substance Requirements
A SAIF Zone company undergoing liquidation is required to meet its obligations related to ESR if it has conducted any of the nine Relevant Activities. The nine Relevant Activities are Banking business, Insurance business, Lease-Finance business, Investment Fund Management business, Holding Company business, Headquarters business, and Shipping business, Intellectual Property business and Distribution & Service Centre business.
The ESR obligations include ESR Notification filing, ESR Report submission and meeting the Economic Substance Test. Hefty penalties await those who fail to meet the ESR requirements. Company liquidators in Sharjah can help you to navigate such complex challenges.
Maintenance of UBO Registers
You must hand over their Real Beneficiary Register (RBR) and Partners or Shareholders Register (PSR) to the SAIF zone Authority within 30 days of appointing the liquidator. The company liquidator or administrator is also required to maintain the RBR and PSR for not less than five years from the date of liquidation. Failing to meet these key UBO requirements will lead to hefty penalties.
Submission of Liquidation Report
The process of winding up a company in the SAIF Zone will come to an end when the liquidator submits his final liquidation report to the Authority. After receiving the final liquidation report, the SAIF Zone Registrar will strike off the name of the company from the Register and cancel the trade license.
Hire the Best Company Liquidators in Sharjah, UAE
Appointing the best company liquidators in Sharjah such as Jitendra Business Consultants (JBC) will help business owners to shut down their operations without any hassle. JBC offers the best company liquidation services in Sharjah through our dedicated team of experienced liquidators. Our expertise is key to navigating the complex steps of company liquidation including VAT, UBO and ESR. JBC’s efficient liquidators can ensure your company is wound up in compliance with existing laws and regulations.