On the road of business development, many entrepreneurs will encounter similar problems: they registered a company many years ago, but now they want to close the company and stop paying taxes due to low income. In this process, there are two main difficulties that need to be solved.

Difficulty 1: Company cancellation procedures are complicated. Company cancellation is not a simple matter. It requires a series of complicated procedures, including but not limited to tax liquidation, industrial and commercial cancellation, and destruction of official seals. Each step needs to be strictly implemented in accordance with relevant national laws and regulations. Any carelessness may lead to cancellation failure and even bring legal risks.

Difficulty 2: Fines and late fees for not filing tax returns on time Even if the company does not have much income, it still needs to file taxes on time. If the tax returns are not filed for a long time, the tax authorities may impose fines and late fees on the company, and may even have a negative impact on the company's legal representative. If these fines and late fees are not handled in time, it will further increase the difficulty of deregistering the company.

So, what are the specific methods?

First, the company's tax issues need to be resolved. Even if the company has ceased operations, tax liquidation is still required to ensure that all taxes payable have been declared and paid. You can ask a professional accounting firm or tax agency to assist in the process to ensure that the liquidation process goes smoothly.

After completing the tax liquidation, you can start the company deregistration procedures. According to the requirements of the Company Law and related regulations, follow the steps to announce, establish a liquidation group, liquidate assets, and cancel the business registration. It is particularly important to note that during the deregistration process, important seals such as the company's official seal, financial seal, and contract seal need to be properly kept and destroyed to prevent them from being used illegally.

The above two solutions can effectively solve the difficulties encountered in the process of deregistering a company and ensure that the company completes the deregistration procedures in accordance with the law and in compliance with regulations. At the same time, it also reminds entrepreneurs to keep good financial and tax records at ordinary times to avoid getting into trouble when problems arise in the company's operations.

Dear Business Owners,

In the process of running a business, you may encounter a situation like this: you registered a company many years ago, but the income has not been much, and now you want to close the company.

So, can we not report the income from these years? The answer is no.

Even if your revenue is low, you still need to comply with tax regulations and ensure your company's tax returns are compliant.

Below, we explain in detail why income must be reported and the correct steps to close a company.

Why must income be declared?

1. Legal requirements

According to the Canada Revenue Agency (CRA), you must file a corporate income tax return (T2) every year, regardless of how much income your corporation earns. Even if your corporation earns no income, it still needs to file a zero return.

2. Avoid penalties and interest

Failure to file a return on time or to report income may result in penalties and interest. The IRS has the power to charge penalties and interest for unfiled returns and unpaid taxes, and these costs may accumulate over time.

3. Keep good tax records

Even if the company has been losing money or has not had much revenue for many years, it is still very important for business owners to keep good tax records. This will not only help avoid tax problems, but also provide evidence in the future when you need to re-register the company or apply for a loan.

Steps to properly close your company

1. Determine the necessity of closing the company

First, evaluate whether you really need to close your company. If you do, you need to follow these steps.

2. Submit unsubmitted tax returns

Before closing your company, you must file any outstanding tax returns. This includes:

• Corporate income tax return (T2).
• Goods and Services Tax/Harmonized Sales Tax (GST/HST) return.
• Payroll tax (if applicable) and other related returns.

3. Settle all debts

Make sure all company debts, including employee salaries, supplier payments, and taxes, are settled.

4. Notify the Canada Revenue Agency (CRA)

Submit your application to close your business to the Canada Revenue Agency (CRA) and ensure all outstanding tax returns and payments have been submitted.

5. Deregistration of the company

Submit a deregistration application to the company registration department of the province you are in. This process varies from province to province and requires submission of corresponding documents.

6. Closure of bank accounts and cancellation of licenses

Close the company’s bank accounts and cancel all permits and licenses related to the company’s operations.

7. Record keeping

Under tax regulations, you are required to keep your company's financial and tax records for at least six years in case they are inspected by the tax authorities.

Summarize

Even if your business does not generate much revenue, you are still required to report your income and file your taxes on time. When closing your business, you must ensure that all tax returns and payments are completed to avoid any legal and financial problems.

If you have any questions or need help with closing your company and tax filing, please feel free to contact our Golden Key Business Development Center. We are happy to provide you with professional advice and support.

How can we help you?

Golden Key Business Development Center is committed to providing you with professional company deregistration services to help you close a company with no income for a long time easily and hassle-free. Our services include:

✅ Full-service agent : From preparing the required documents, submitting the cancellation application to communicating with the tax department and the Industrial and Commercial Bureau, we will handle the entire process to ensure that your company's cancellation process goes smoothly, saving you time and energy.

✅ Financial and tax liquidation : We will help you with your company's financial and tax liquidation to ensure that all accounts are clear and tax declarations are correct to avoid possible disputes and fines in the future.

✅ Personalized solutions : Each customer's situation is different. We will provide tailor-made solutions based on your specific needs to ensure that your company closing process is efficient and smooth.

Choose Golden Key Business Development Center, you will enjoy professional and efficient services, and easily solve the problems of company closure and cessation of income reporting. Let us help you through this transition period and welcome a better future.

What are the benefits of having us handle your company closure?

✅ Compliance assurance

Our professional team is well versed in the latest tax laws and ensures that financial reporting is compliant.

Our professional team will ensure

All steps and documents are reliable and complete

If you need