Company Cancellation In Shenzhen: Do You Need To Be Present?

Cancellation of a company is not a simple matter. If the company is very simple and hasn't been active since its establishment with no revenue, it can be simply cancelled without advertising in newspapers, but it needs to be publicized for at least a month and a half, and the cost is about 1,500 yuan. Tax simple small businesses usually costs at least 2,000 yuan for cancellation, while general taxpayers’ companies cost at least 4,000 yuan. In some cases, even tens or hundreds of thousands of yuan are required for the cancellation of a company. Why is it so expensive to cancel a company?

First of all, the management process of company cancellation is very complex and cumbersome. The specific cancellation process includes: initial registration with Industry and Commerce Bureau, tax application for cancellation with State Tax Bureau, tax application for cancellation with Local Tax Bureau, submission of cancellation documents to Industry and Commerce Bureau, deletion of codes and bank accounts.

The entire cancellation process generally takes about two to six months for the company. If a serious problem occurs, it may even take up to one year to cancel. The procedures for simple and general cancellation are different. Then you may ask, can't we just choose simple cancellation that is fast and easy? In fact, the simple cancellation is only applicable for those companies without any income, a public account, a social security account, bank transaction records or invoices, and those whose tax returns are on time without overdue tax declarations.

For those companies that do not meet the qualifications of simple cancellation, general cancellation is required, which includes clearing up taxes and obtaining a tax clearance certificate, applying for Industry and Commerce Bureau cancellation, and processing cancellation procedures for bank public accounts, etc. During the cancellation process, there will be many documents to provide, such as accounting books, vouchers, financial accounting reports, and tax filings for both national and local bureaus. Moreover, the tax authorities will check for any risks of abnormal taxation, tax evasion, underreporting, or other tax problems.

Furthermore, during the process of company cancellation, a company may need to pay a lot more due to unexpected factors such as outstanding bills, rental contracts without invoices, and tax arrears. This is why the cost of cancelling a company is higher than that of registering a new company.

If a company is not cancelled, it may lead to serious consequences. The company will lose its credibility, and the legal representative and shareholders may face several restrictions such as being blacklisted by Industry and Commerce Bureau, being unable to receive pensions, being unable to obtain loans to buy houses or migrate, and having accounting information made public for legal purposes. In addition, if taxes are not paid on time, invoices may be blocked, and tax authorities may investigate or even impose fines. The abnormal operation will also be recorded in the enterprise credit system, which will limit the company's future business opportunities.

In conclusion, cancellation of a company is a complex and expensive process, and the lack of awareness or knowledge of the process may lead to more issues. It is recommended to hire a professional agency or lawyer to handle it properly. The cost is worth the effort to avoid the consequences of not taking action.