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Peculiarities of Liquidation of Companies in Belarus

After the company’s owners decide to liquidate, the process is controlled by the state and regulated by the relevant legislation. In our article, attorneys talk about the main features of the liquidation of companies in Belarus, the rules and requirements that must be followed during this procedure. In the case of liquidation of the company, we recommend contacting an experienced lawyer, as several liquidation features need to be considered in each specific case for a particular company.

When can the company be liquidated

The owners of the company can decide at any time to liquidate it. It is called “self-destruction”. The reasons for self-liquidation are not required to be specified in the liquidation decision.

What needs to be evaluated before the company is liquidated

Before making such a decision, you need to pay attention to several points:

  1. Whether the company is included in the inspection plan by regulatory authorities. If enabled, the company will be liquidated at the end of the audit.
  2. How long the company has been inactive. If there is no activity for 24 months, the company must be liquidated voluntarily. However, in this case, it can be liquidated by the registration authority.
  3. The company must go into self-liquidation when the legal entity is liquidated – the only participant (owner of the property) of this company.
  4. It is necessary to check whether there are grounds for bankruptcy on the company’s initiative. In particular, it is essential to check whether the company has problem debts that are difficult to repay. If there are grounds for bankruptcy, then it will not be possible to liquidate the company without bankruptcy proceedings.
  5. Determine the property that can be sold and distributed among the owners.
  6. Decide what to do with hired employees.
  7. Make an inventory of accounts receivable.

Features of deciding on the liquidation of a company

The participant chooses to liquidate the company – the company owner – when he is the only participant or the only participant at the general meeting of the company’s participants. The decision is fixed on paper.

The decision prescribes:

Who the liquidator of the company is. This is usually the head. Otherwise, it will be necessary to reissue a card with signature samples at the bank to the person appointed by the liquidator, conclude an agreement with him and conduct an inventory of the company’s property.

Sometimes, a liquidation commission is appointed. The selection of the commission has peculiarities related to the company’s accounts payable. In particular, when a company has debts, it is impossible to appoint the head of the company as chairman of the liquidation commission.

When it is decided to create a liquidation commission, the decision distributes responsibilities among its members.

The procedure for liquidation, as well as the term of liquidation. According to the legislation, the term of voluntary liquidation of a company can be up to 9 months. The liquidation period can be extended up to 12 months by a decision made at the general meeting of the company’s participants.

The decision may indicate the need for an audit, but this is not a prerequisite for the company’s liquidation.

The peculiarity of the audit decision

Usually, a voluntary audit of a liquidated company replaces mandatory inspections by tax authorities, customs, and Belgosstrakh during the liquidation of a company. In the case of an audit, these state bodies conduct only an analysis of the company’s activities based on an audit opinion. However, this is not the rule. Sometimes, inspections by government agencies are possible even after an audit of the company. You can understand the specifics after consulting a lawyer.

Publication of information on liquidation 

In Belarus, it is customary to publish information that the company has decided to liquidate on the website of the Justice of Belarus magazine. The information on liquidation indicates the procedure and deadline for filing creditors’ claims against the company being liquidated.

This publication is paid. First, the payment is made, and then information about the liquidation is published on the website. A paper publication on liquidation is published after publication on the journal’s website in a physical appendix to the journal.

Interaction with the registration authority

The registration authority is the government agency that registered the company. The name of this state agency is spelled out in the Certificate of State Registration issued to the company. After the decision on liquidation, an application for liquidation and a package of documents are sent to the registration authority. These documents can be brought personally to the registration authority or sent electronically via the Unified State Register of Legal Entities and Individual Entrepreneurs (USR) website. In this case, you must sign the documents with an electronic digital signature.

The registration authority itself notifies the tax, customs and Belgosstrakh of the company’s liquidation.

What documents are submitted to the registration authority in case of voluntary liquidation of a company:

  1. Application for liquidation. The form of this application is available on paper at the registration authority and in electronic form on the USR website.
  2. The owners decided to liquidate the company.
  3. When a foreign company is among the owners of the company, it is necessary to prepare in advance and legalize an extract from the commercial register of the country where the company is registered.
  4. A document on payment for the publication of the liquidation in the journal “Justice of Belarus”.
  5. A document that confirms the authority of the person who submits the liquidation documents.

Who needs to be notified about the liquidation

Notification of employees

Employees should be notified about the company’s liquidation. This is done in writing two months before the liquidation. The option is to replace the warning with a cash payment to employees with their consent. In this case, the compensation should be at least two months of average earnings.

Notification of the Social Protection Fund

When a liquidated company dismisses employees in connection with liquidation, it must notify the labour, employment and social protection authority at the company’s location.

Report in Belgosstrakh

Belgosstrakh submits a liquidation report to the registration authority within 15 working days after applying for liquidation. The report is submitted on paper or electronically from the beginning of the calendar year.

Notification of debtors and creditors

The liquidator must notify the company’s creditors in writing about the liquidation. The notifications prescribe a deadline for filing creditors’ claims, which must correspond to the deadline specified in the publication on liquidation on the website of the journal “Justice of Belarus”. To account for creditors’ claims, the liquidator maintains a register of claims.

Debtors usually request early fulfilment of obligations concerning the company’s liquidation.

Preparation for the tax audit

The liquidated company is required to submit a declaration to the tax inspectorate within 5 working days after the package of documents on the liquidation of the company has been sent to the registration authority. When there is a need to pay taxes, you need to pay off the budget within 5 days after filing your tax return.

Usually, the tax inspectorate conducts a tax audit of the company within 30 days after it receives a notification from the registration authority about the liquidation of the company unless there is a voluntary audit.

To prepare for a tax audit, you need to:

  • Analyse the availability of accounting documents and the correctness of their filling.
  • Collect documents for the entire tax period, which the tax service checks.
  • If necessary, if possible, restore the lost essential documents.

Interim liquidation balance sheet 

The interim liquidation balance sheet is compiled during the liquidation period for submission to the tax inspectorate at the place of registration of the company. This document was drawn up after the deadline for filing creditors’ claims, which was indicated in the publication on liquidation on the website of the journal “Justice of Belarus”. The interim liquidation balance sheet suggests the following:

  • The list of the company’s assets.
  • List of creditors’ claims.
  • Creditors’ claims have been recognized or not recognized.

Before drawing up a balance sheet, an inventory of assets and liabilities is carried out.

The interim liquidation balance sheet must be approved at the general meeting of participants or by a participant when one founder founded the company.

You can refer questions related to accounting and tax aspects of liquidation to our experienced accountants. All necessary documents will be drawn and submitted to the tax office immediately.

Employee issues

Employees who remained employed at the time of liquidation are dismissed in connection with the company’s liquidation. The date of dismissal, in this case, is not earlier than 2 months from the day the employees received a written notice of dismissal in connection with liquidation.

On the day of dismissal, an order is issued for the dismissal of employees, records of dismissal are entered into their workbooks and severance pay is paid in three average monthly earnings. After the dismissal is recorded, workbooks are issued to employees.

Settlement issues with creditors

The company settles with those creditors whose claims are recognized in the approved interim liquidation balance sheet. The legislation establishes the order in which calculations are made.

So, first of all, they are calculated according to creditors’ claims that arose in connection with harm to life and health.

Further – on severance payments, salaries, and copyright agreements.

In the third place, for taxes and customs payments, payments to the social protection fund of the population, and obligations secured by collateral.

Last of all, the claims of other creditors are satisfied.

When a company does not have enough funds to settle with all creditors, the company’s property is sold at public auction.

Settlement issues with the owners of the company

If the company still has property after settlements with creditors, it is transferred to the owners of the company. The liquidator distributes the property as follows:

  1. First, the owners are paid the distributed profit that was not paid earlier.
  2. Then, the company’s property is distributed among the owners in proportion to their shares in its authorised capital.

Final liquidation balance sheet

After the company has settled with all creditors and owners, another inventory is carried out. After that, the final liquidation balance sheet is drawn up.

At this stage, it is necessary to resolve the issue of unused invoices and other documents with a certain degree of protection. In particular, you need to draw up an act for writing off forms, submit it to the tax service and destroy unused forms of documents.

The final liquidation balance sheet is approved at the general meeting of the participants or by the sole participant. A copy is then submitted to the tax inspectorate.

Issues of transferring documents to the archive

All documents of the liquidated organisation must be deposited in the archive at the company’s location. For archiving, documents are sorted, stitched and numbered. When transferring to the archive, an act of transfer is drawn up.

You can help you to prepare documents for transfer to the archive, as there are many features related to the requirements of archives for the transfer of documents for storage.

Submission of documents to the registration authority and liquidation of the company

The final liquidation balance sheet and the company’s original certificate of state registration are transferred to the registration authority. After that, the registration authority makes an entry in the Unified State Register on the exclusion of the liquidated company from it.

The company is considered liquidated from the date when the registration authority decided to make an entry on the company’s liquidation in the Unified State Register.

How we can help prepare for the voluntary liquidation of the company and in the liquidation process

Our employees are experienced specialists in the field of corporate law. We can:

  • Advise you on preparing business processes and documents for the company’s liquidation.
  • Prepare a package of documents related to the voluntary liquidation of the company: a decision on liquidation, warning employees, creditors and debtors.
  • Develop a step-by-step liquidation algorithm for your company, indicating the timing and cost of the liquidation process.
  • Deal with accounting and tax issues related to the company’s liquidation.
  • Organise a voluntary audit.
  • Carry out the liquidation procedure for your company on a turnkey basis.
  • Represent your interests in government agencies on issues related to the company’s liquidation.

Contact us

If you have any questions about the company’s liquidation in Belarus, we will be happy to help you! Our long-term experience in corporate law will help you resolve any disputes.
Phone and e-mail communication options are available for your convenience:

  • +375293664477 (WhatsApp/Telegram/Viber);
  • info@ambylegal.by.
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