Simplified liquidation of small and medium-sized businesses

From July 1, 2023 voluntary liquidation of small and medium-sized businesses will be possible in a simplified form by submitting the shareholders’ application. This way they will confirm that settlements with creditors have been completed, the dismissed employees have received all due payments, and the company will submit the necessary statements no later than one working day before being excluded from the Unified State Register of Legal Entities (EGRUL). Simplified liquidation will significantly reduce the time and money costs of small and medium-sized businesses for the termination of their activities. Besides, this procedure will allow to avoid negative consequences for the shareholders who sometimes abandon the company without submitting reports and going through statutory liquidation procedures due to their complexity and duration.

Organizations that can be liquidated under a simplified procedure should:

  • be included in the small and medium-sized businesses register;
  • not records of inaccurate information in the EGRUL;
  • not be VAT payers or be exempt from its calculation and payment;
  • complete settlements with creditors and employees;
  • pay all tax and other obligatory payments debts;
  • not own real estate or vehicles;
  • not be in the process of liquidation, reorganization, bankruptcy or exclusion from the EGRUL by decision of the registration authority.

Within 5 days of filing the application, the Federal Tax Service will verify whether the company has obstacles to simplified exclusion from the EGRUL and will publish the resolution on the upcoming liquidation in the State Registration Bulletin. Within the next 3 months persons objecting to the termination of the activities of the organization may declare it. If there are objections, the company will be obliged to carry out the procedure of voluntary liquidation established by law in full by itself. In the absence of objections, the company will be excluded from the EGRUL. The resolution on company’s exclusion may be appealed by its creditors or other interested persons whose rights are violated by this act within one year from the date when they became aware or should have become aware of the violation of their rights.