Dissolve a corporation in British Columbia

Voluntary dissolution in British Columbia

A British Columbia company can bring its existence to an end when its business has stopped, its assets have been sold or it was never used. The dissolution is filed with the BC Corporate Registry, not with Corporations Canada: this page covers companies incorporated in BC. A federal corporation operating in BC dissolves federally, then cancels its extraprovincial registration in BC.

Under the Business Corporations Act, a voluntary dissolution rests on three elements: the shareholders' authorization, the company's assets and liabilities being dealt with, and a dissolution application filed with the registrar. Here is the usual sequence.

1. 1Annual reports up to dateThe registry expects the company's annual reportsannual reportsMandatory yearly filing with the registry, separate from the tax return. Missing it can lead to dissolution.See definition → to be filed before it accepts a dissolution. Deadline: Within 2 months after each anniversary of incorporationsource. Fee for each report: $43.39source.
2. 2Shareholders' resolutionThe shareholders authorize the dissolution by ResolutionResolutionFormal decision of directors or shareholders, recorded in the minute book.See definition →, in the form the Act and the company's articles require. The resolution is kept in the company's records.
3. 3Assets and liabilitiesThe company pays or provides for its debts and distributes what remains to its shareholders. A director confirms this in a sworn statement that supports the application.
4. 4Dissolution applicationThe application is filed online with the BC Corporate Registry, with the government fee, and identifies who will keep the company's records after dissolution.
5. 5Certificate of dissolutionThe registrar issues a Certificate of incorporationCertificate of incorporationRegistry-issued document confirming the corporation’s legal existence from its effective date.See definition → of dissolution. From its effective date, the company no longer exists and its name leaves the active register.

Dissolution is not the only way to stop operating. Some owners sell the shares rather than the assets, amalgamate the company with a related one, or simply keep it inactive. Each route has different tax effects. An inactive company still files its annual report every year and its corporate income tax return, and it remains on the register with its directors and its registered office. Which route fits a given company is a question for its accountant, ideally before any asset is sold.

Final returns and clearances

The registry filing is usually the last step. Before it, a BC company closes its accounts with the federal and provincial tax authorities. The list below is general; what applies depends on the company's activities, payroll and tax registrations.

• Final T2 return: the company files a final corporate income tax return with the Canada Revenue Agency (CRA), covering the period up to dissolution.
• GST and payroll accounts: the last GST and source deductions are remitted, the final returns are filed and the CRA accounts are closed.
• BC provincial sales tax (PST): a company registered to collect PST files its final return and cancels its registration with the BC Ministry of Finance.
• WorkSafeBC and other provincial accounts: an employer closes its WorkSafeBC account and any other provincial registration tied to payroll.
• Clearance certificate: before distributing property to shareholders, the person in charge of the distribution can ask the CRA for a clearance certificate. Distributing without one can make that person liable for tax the company still owed.
• Bank accounts and property: assets are sold or transferred and bank accounts closed. Property left in a dissolved company can pass to the government.

Timing matters. The final return covers the company's activity up to dissolution, so it is usually prepared once the last assets have been sold or distributed. Many accountants handle the final returns and the distribution together; the dissolution application is then filed once the tax accounts are settled, so that no notice from the CRA or the province lands on a company that no longer exists.

Government fees for dissolving a company in BC (sourced)

The registry fee is modest; the larger costs of closing a company usually come from the final tax returns and the accountant's work on the distribution. Incorpo's own fee is shown separately from the government fee, before you pay.

Letting the company lapse instead is not free of consequences. The registrar can dissolve a company that stops filing (Failure to file annual reports for 2 consecutive yearssource), its property can pass to the government, and bringing it back later means a restoration application: $350 basic fee (+ name approval, overdue annual reports and director notices)source. A voluntary dissolution leaves a clear record that the company was closed in an orderly way.

How we file for you

1. 1Guided questionnaireYou give us the company's incorporation number and tell us whether it still has assets, debts, employees or tax accounts. The questionnaire flags overdue annual reports and the steps that usually come first.
2. 2Documents prepared from your answersWe prepare the shareholders' resolution and the dissolution application. You review them before anything is filed.
3. 3Signatures onlineShareholders and directors sign electronically. The signed documents are added to the company's records.
4. 4Filing with the BC Corporate RegistryWe file the application online and pay the government fee on the company's behalf.
5. 5Certificate in your accountThe certificate of dissolution is stored in your account with the company's minute bookminute bookOfficial record holding a corporation’s articles, by-laws, resolutions and registers.See definition →.

Incorpo does not prepare tax returns and does not give legal or tax advice. The final returns, the clearance certificate and the distribution belong with your accountant; a company that cannot pay its debts is a matter for a lawyer or a licensed insolvency trustee.