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today's video I want to cheat to you guys about how to close a [Music] business good day my name is H from sa counting Network and I've been in the accounting industry since 2008 so over the years I've dealt quite a bit with businesses when people want to close businesses as well of late a lot of people been receiving notifications from the receiver of Revenue and also from sipy where they're threatening the cars with legal action and saying that the compan is are going to be deregistered and you're going to get in all sorts of trouble and that is the reason I decided to record this video as well just to explain to you guys what the process is and and how the process works to deregister company just for clarification um yeah at the moment that is this what I'm going to share with you guys is how the process works at the moment but with the receip of Revenue and even with sipy we work with a moving Target so stuff changes all the time so at the moment this is the way that you need to approach it when you want to close a business remember before just before I start with the presentation remember to give the video a like remember to subscribe to my channel and then the make get on to my computer and I can show you guys what it is about so let me talk to you guys quickly through the process of what you need to do if you want to close a business inside Africa so I think what I'm going to discuss just briefly is the first one I'm going to just touch on Dorman companies what your responsibilities is if you've got a company that's basically the shell that you registered you never did anything like that we can to unpack that little bit then we're going to start looking at trading companies as well I'm going to give you guys a brief overview of what it is to do a voluntary closure of a business and then obviously what it is to do a compulsory closure of a business um obviously in the legal field and in tax World they've got different terminologies for this stuff but I'm just trying to make it as understandable as possible for the normal person out on the street so let me quickly explain to the dant company situation let's say for instance you open up a business let for instance 10 years ago or 20 years ago you registered the company with with with sipy or back then it was called cpro so remember as soon as you register that company they send that information through to the rece receiver of Revenue and that company automatically got a tax number so something changed um and in the past if you open up that company and never trade it or anything like that then syy said that if you don't find your annual returns for a couple of years then automatically that company would de register with sipy and the same assumption was always with the receiver of Revenue that if it just leave the thing don't do anything to it then it's obviously just going to go just um disappear into the abis eventually unfortunately I would say about 2019 there was a change in the legislation now since then they actually started making this thing a bit of a more formal process so in the past it just used to be automatic thing leave it it just disappears now they said no they want to actually have proof that the business is not trading that you're going through a process of deregistering that company and I think one of the reasons why I can assume that they're doing this as well is that the receiver of Luc revenue is looking for money government hasn't got any money anymore so this is a soft target they can just go and give these guys penalties for not submitting outstanding returns but we'll talk about the penalties in a bit so yeah first thing dman company so that is if you registered a company let princes in 2000 you had this idea in your mind that you want to start the business but eventually you got so busy with life and work and stuff that nothing ever happened to that business he never opened up a bank account so in old terminology it was just the shell company so was just something lying on the shell of shelf over there and there was nothing done with it so in theory there wouldn't be a bank account so that is probably the test or whether the business whether traded or not traded as soon as there's a bank account in the name of a company there's transactions linked to that to that bank or to that company as well and remember the receiver of Revenue receives data from the banks to say that if there's a company and there's a bank account L to it then they see can can see that there's money going through that account so even if you're just putting money into that account just to keep that company open there's still transactions happening so in theory that company is not a dant company because you're paying Bank charges you're putting money into my loar account and all that type of stuff so you can't just say sorry the company never traded and therefore um um you just want to file it as a dor company so I think it's just important as a starting point just remember the definition and normally by by default the first thing that you would obviously need is you would have to go make an affidavit to say that you registered the company let's say for instance in the year 2000 here's the registration number here's my details of the director that you never pursu this business venture and therefore you decided that you want to close the business you want to deregister it with the receiver of Revenue de registered with sipy and that is basically what that affidavit would State without that document you can't even start the process of of going through the process so let me explain to you the first thing with the receiver of Revenue is because the guys are getting these notifications you must file all the outstanding tax returns that's going to be step one after that you need to find the tax clearance certificate that you need to get from the the receiver of Revenue once you have those that document the tax clearance certificate then you need to submit um just with the finding of the outstanding tax returns so obviously those returns are going to be f as zero returns so the very first page there's a questionnaire you're just going to say the company never traded but then sometimes s ones prove that the company didn't trade and that is where that affidavit comes in you here so it's really really important that you do that affidavit because that's obviously the starting document that you're going to use once you have your tax given certificate you as the direct of the company or the member of the CC or whatever format it is you need to send suby a letter to state that you want to apply for the de registration of that company that process unfortunately takes a while normally 6 months later on average you will receive a email back from the sipy with a certificate which they call a deregistration certificate so that is proof that the company was deregistered at cpy once you have the de registration certificate in end you need to go back to the receiver of Revenue normally inperson appointment or you would have to make a telephonic appointment or video appointment to say that you want to apply for the deal registration and then once you have the affidavit that you were talking about plus that certificate from subp anded end the receiver of Revenue then in theory they will deregister the company Tax R number and then after that your responsibilities regarding that company is then done so that is in short the process that you need to follow to D register a Dorman company where the problem comes is when it comes with a receiver of Revenue you basically have two different ways that you can find your outstanding returns and or and to get the tax clearance certificate so the first one is if you do it online so you can do it online you'll see that I did a video of how to appoint a representative on eiling if you don't represent or uh um activate the representative you can't access anything about that company so that's going to be step one you're going to have to take the registration documents you're going to have to take your ID proof of address the affid davit and then you're going to have to go onto the Sasha system you'll see that I did a video on that system as well of how to appoint the representative do the representative appointment that process probably takes about 2 or 3 weeks sash will maybe get back to and say they're missing this document or this might be certified or there's something missing and only once that process is finished then we we have the ability to link that company to your e finding profile and that is the second building point that I said that the representative must be registered on E finding because there's no use to go through the representative appointment but there's now no place to link that company to you see so after that once we have the E finding for the representative remember that is us as the Director then we need to go to the next step to link the company to your e finding profile so when you log into eiling you'll have a drop down we can choose between your personal eiling or the company's eiling once you have that ability then you can start finding the outstanding tax returns once you have all the outstanding tax returns in then you can apply for the tax clearance certificate and then once you to get your tax given certificate email that through to sipy 6 months later you get your D registration certificate then you need to make that appointment for your final de registration so under s homepage itself there is a place there where you can make appointments so that is how the online version would work the second option that you've got which might be a bit easier if you've got no intention to get this company registered again or to do anything with it is go visit the sash bronch take your affid David with take the registration documents take your ID book take your proof of address and then you go sit there at a sash BR say to that sash person over there that yes the documents you received this SMS he never started trading on this company yes D David please F all the outstanding returns while he sitting there at s and give you the tax clearance once you have that tax clearance certificate same process you must email sipy to say listen guys company never traded here my tax clearance I want to deregister 6 months later you get your certificate from them then you go back to S for second appointment to do the final D registration so I think that is the challenge that we've got at the moment with the receiver of Revenue remember everything that I've discussed so far relates to dormant companies now if you start looking at at trading companies so there's two different um types of of ways that a Trading Company can can be closed so the first one is a voluntary closure so if I've got a business as if for instance it traded 5 years ago and I traded with a business and eventually I decid no this is not profitable anymore I paid all my creditors I've got no outstanding money but I do have the accounting records for that then this is the process that you would follow them so same again the receiver of Revenue as I mentioned in the previous slide all the stuff over here on the left hand side would be relevant you must still do the representative appointment the representative must be linked to e finding to link the company then he can start doing returns tax cence all that stuff still stays the same but now because the company was trading you need to file the outstanding returns so on those company Tax Returns you must declare what was the income what was the expenses what was the assets what was the liabilities what is your Equity all that stuff goes onto the those tax returns and then you can submit the company Tax Returns even once the company for instance 5 years ago it stopped trading you still need to submit all the tax returns since that stopped trading because obviously there were still some records on that company as well if the company was registered for pay you in there's a form they call it emp1 123 that you need to complete they there's a functionality we can do it online as well but that is the form and then for value added tax if your company was registered for vet then you need to complete a vet one 2 three form as one and submit that through to the receiver of Revenue so that they can deregister those two tax numbers remember there's three tax numbers company Tax pays you in if you were if you had employees and the last one is that you added tax if your turnover was high enough that you had to register and then the same process happens again get your tax given certificate go to subc apply for the de registration 6 months later you get your certificate go back with that certificate to the receiver of Revenue then you apply for the final D registration of the company Tax so the pay is you earn and that you can deregister quite quickly but the company tax return they won't deregister that until you've got that D registration certificate from subpc then the last one is if you've got a Trading Company it's a compulsory closure so that is um if your business is traded obviously you might have accounting records and this is normally where becomes very technical because that's in in in places where you're basically liquidating the company so if you've got a million R worth of assets but you've got 2 million rents with of liabilities you can't pay all your debt and this is the procedure that you would follow you would normally go see your lawyers they would get Liquidators involved with the process as well they will do valuation of the assets and the liabilities they will drop a liquidation account to say that if there's only 1 million rent in that they can get cash and there's 2 million rents worth of creditors then every person will just get half their money so that is quite a big formal process that you have to go to normally there's courts involved and then obviously s and credit is also quite involved so this is a very specialized thing and this is where you would definitely have to get professional advice so I think just another thing that you must keep in mind as well that if you did register with sub and that it did register with sash then don't forget about the Department of Labor that's really really important as well if ever you were registered for UF you have to inform those guys that you're not an employee anymore that you need to deregister workman compensation is what you have to deregister with workman compensation if you ever were registered over there if you owed suppliers money remember that you can't just say the guys listen guys I'm not going to pay anymore you must sort out those supplies over there and I think something a lot of people forget about about as well as employees and I think I just wanted to just to add that on so you guys are just aware of that so yes so that this isn't n on how it works if you want to D register company so just remember once again just to give the video remember to subscribe to my channel and if you guys do need help to deregister your company inside the description of the video I'm going to share a link where you can pop us an email or fill in a form and then we can see if we can get in touch you guys in touch with the right person that can assist you with the closing of your business thanks for watching