Company Deregistration Tax Liquidation Process and Simplified Deregistration Eligibility

Company deregistration involves multiple processes across business registration, tax, social security, and banking, with tax liquidation being the core and most problem-prone stage.

1. Standard Deregistration Process

The standard process is: shareholder resolution to dissolve → form a liquidation group → file the liquidation group → public notice via newspaper or National Enterprise Credit Information Publicity System (45 days) → tax deregistration and liquidation → social security deregistration → bank account closure → business registration deregistration. The full process typically takes 2–3 months.

2. Tax Liquidation Essentials

Before deregistration, enterprises must complete filing and payment of all tax types, including current-period filings, overdue prior-period filings, and CIT liquidation returns. The liquidation period is treated as an independent tax year, and CIT is payable on liquidation income. Disposal of inventory and fixed assets is subject to VAT as prescribed. Uncredited input VAT is not refundable.

3. Simplified Deregistration Eligibility

Limited liability companies, non-corporate enterprise legal persons, sole proprietorships, and partnerships that have no outstanding creditor's rights or debts, or have fully settled them, may apply for simplified deregistration. The public notice period is 20 days (shortened from the original 45 days). However, entities listed in the business abnormality directory, under active investigation, or in other prescribed circumstances are not eligible.

4. Key Considerations

Prior to deregistration, all tax arrears, late fees, and fines must be settled; invoices and tax-control devices must be surrendered; and pending tax refund matters must be resolved. Branch offices must be deregistered before the head office. A pre-deregistration tax health check is recommended to avoid impediments arising from issues discovered during the process.