Steps and Process to Liquidate
Process to Apply for Liquidation
Please complete the attached form to enable me to prepare for the meeting and draft the documents if required.Trust you are well, I would like to thank you for visiting our website www.liquidationexperts.co.za.
Please note that we can look at different scenarios, Business Rescue, Liquidation etc.We will contact you later today to discuss the matter and the way forward, each Business has a different case scenario and we have to plan ahead before we start with the whole Liquidation Process.
Download the form from our website, or contact to email all the forms and information Form that needs to be completed as far as possible and emailed back to us, to enable us to assist you in making the right decision.Once we have received all the information we can start to analyse the Financial Status of your
Business.Once the Company or Close Corporation has been Liquidated we will deal with all the Creditors of the Liquidated Company or Close Corporation.Thus this will not be your head ache anymore!!!!!!!!!!!
When a Company or Close Corporation is Liquidated all LEGAL ACTION STOPS IMMEDIATLY. No Creditor can attach any Assets.A Provisional Liquidator will by Appointed by the Master of the High Court to deal with the Assets and Liabilities of the PTY/CC.There are two options that I can assist you with.
Option 1 –POA (Fee Agreement if Applicable when assistance and advice is required)
WHAT WILL WE DO FOR YOU?Assist the Director or Member in the Liquidation of the Company or Close Corporation.We will draft the Liquidation documents and submit the Liquidation documents to Liquidated the CC or Pty.
Option 2 – POA (Arrange Appointment of a Liquidator) + (Fee Agreement if Applicable when assistance and advice is required)PAYMENT ARRANGEMENT CAN BE MADEWe will draft the Liquidation documents and submit the Liquidation documents to Liquidated the CC or Pty. We will thus also arrange the Appointment of a Liquidator and assist with the process from Point A- Z.
WHAT WILL WE DO FOR YOU?We will draft the Liquidation documents and submit the Liquidation documents to Liquidated the CC or Pty Assist the Director or Member in the Liquidation of the Company or Close Corporation.Help Secure the Assets till the Master of the High Court has Appointed a Provisional Liquidator.Assist the Directors and Members with any matters relating to the Liquidation.Sec 89 cost of the Insolvency Act – Cost for Liquidator to attend to the Administration of the Insolvent Estate.
Please note that the ANNUAL RETURNS at CIPC must be up to date, we can also assist you in this regard.Please feel free to contact us if you have any question, we will gladly assist you.ARE DIRECTORS UNDER OBLIGATION TO PUT THE COMPANY UNDER RESCUE, OR IS IT A CHOICE UNDER THE NEW COMPANIES ACT!S129(7) (As amended by Sec 82 of Act 3 of 2011)
If the board of directors of a company has reasonable grounds to believe that the company is financially distressed, they must either;Put the company under business rescue, or;Deliver a written notice to all shareholders, creditors, employees and trade unions, that the company is financially distressed, and give reasons why the company is not put under Rescue
The new companies act’s profound influence on the liability of Members and Directors:The new Companies Act No. 71 of 2008 came into effect on May 1, 2011. Before the New Law came into effect, the Old Companies act placed no direct obligation on directors and members when a company / CC were in financial problems
.If the above are not met, it is a criminal offense.Under the new Act, a director / member may no longer “just wait and see”, he must do something about it.ONCE THE PTY/CC HAS BEEN PLACED INTO LIQUIDATION SARS MAY NOT PROCEES WITH ANY LEGAL OR CRIMINAL ACTION Please note that SARS can proceed with Criminal Proceedings:In terms of either section 91 of the Income Tax Act and/or section 40 of the Value-Added Tax Act and/or section 14 of the Unemployment Insurance Fund Act and/or section 13 of the Skills Development Levy Act you are hereby notified that should you fail to make full payment within 10 business days from the date of this notice, a statement will be filed with the relevant clerk of the Magistrates’ Court or the registrar of the High Court, upon which a civil judgment for a liquid debt will be entered against you in SARS’ favour for the above amount together with interest. A warrant/writ of execution may then be issued to attach and sell your assets.In addition, you are hereby informed that SARS may without notice appoint an agent, as described in the provisions of section 99 of the Income Tax Act and/or section 47 of the Value-Added Tax Act and/or section 14 of the Unemployment Insurance Fund Act and/or section 13 of the Skills Development Levy Act, to pay the outstanding amount on your behalf.Furthermore, the submission of either Value-Added Tax and/or PAYE returns without payment constitutes a criminal offence in terms of either section 58(d) of the Value-Added Tax Act and/or paragraph 30(a) of the Fourth Schedule to the Income Tax Act. SARS reserves the right to institute criminal proceedings in this regard.SARS : Liability under Tax Administration Act
On 1 October 2012, the Tax Administration Act was promulgated. Referred to the TAA for short.Under the TAA, Directors, Members, Internal Bookkeepers, External Auditors are all liable for the Companies outstanding taxes. SARS can issue civil and criminal summons in this instance.Should you be behind on your taxes it is a serious matter and will need to be dealt with rather urgently to try and mitigate these risks.Please consult with us to find out what legal resources are to your disposal.
Process after a Business has been Liquidation
APPROXIMATE TIME SPAN OF LIQUIDATION PROCESSINSOLVENCY PROCESS
STEP-BY-STEPAppointment of Liquidator 1 to 6 month1.
Provisional sequestration/liquidation Order is granted
2. Potential Liquidators/Trustees lodge requisition within 48 hours of court order
3. Master of the High Court appoints Provisional liquidator/trustee
4. Provisional Liquidator/Trustees take control of assets. Provisional Liquidator/Trustees mails 1st circular + claims forms to all known Creditors
Fist Meeting of Creditors 1 to 6 month6.
Final Sequestration/liquidation order is granted. Master convenes 1st Meeting of creditors/or Liquidators in case of CC.8. First meeting takes place
Second Meeting of Creditors 2 -6 months. Provisional Liquidators/Trustee comments on assets. Master of the High Court issues final certificate of appointment.
Liquidators convene 2nd meeting. Advertisement appears in newspaper + 2nd report is send to all known Creditors
Special Meeting to Proof Claims 3 to 6 months
2nd Meeting takes place (prove claims)14. Special Meeting to prove of late claims (if required)
Lodgment of Liquidation and Distribustion / Contribution Account 1 to 12 months.
Lodge Liquidation Account with Master or apply to lodge.
Master inspects account and issues query sheet. Liquidators/Trustee replies to A queries.
Pre-Confirmation of Liquidation and Distribustion / Contribution Account 12 to 24 months.
Once all A queries are deleted: Master grants permission to advertise the Account. Place advertisement & send circular regarding inspection period to all proved creditors. Account lies open for inspection at Master & Magistrate’s office.
If account lies free from objection, Master confirms account. Dividend payments are made according to confirmed account
Note: Assets may be realized before Second Meeting of creditors with consent from the Master of the High Court.