What happens if you abandon an LLC: close, but not liquidate

What happens if you abandon an LLC: close, but not liquidate

When a business ceases to generate income or becomes irrelevant, the owner is faced with a question "What to do next?". Someone turns to lawyers for official liquidation, someone simply abandons the company. What is the smartest way to solve the riddle? What are the consequences for the owner of an inactive, but not liquidated company?

At first glance, the idea to abandon an LLC seems attractive: you don’t have to pay taxes, submit reports or use a current account. Such scenario threatens the owner with further prosecution. On the other hand, the formal liquidation of a company requires a lot of time and financial costs. Not to mention the complexity and multi-stage nature of the procedure itself.

Therefore, the desire to say goodbye to a failed business as soon as possible is quite justified and obvious. Even if the company was successful and closed after achieving its goal, avoiding official liquidation will give you the only one output - legal liability.

What should the owner of an abandoned LLC expect?

  • First, fines. The Tax Code provides for liability for non-payment of taxes and ignoring the requirements of the fiscal service. Failure to submit even zero accounting reports may turn to the company with a fine of 1,000 rubles. The directors will be brought to administrative responsibility for this: a fine from 300 to 500 rubles.

    The amounts are really insignificant in business terms. But do not forget that a company can be listed in the register of legal entities for many years and accumulate debt. Moreover, it’s not only the tax service that might give you a fine - it might be also charged by the Pension Fund and the Social Insurance Fund.

  • Secondly, disqualifications. When the tax authority liquidates the company on its own initiative, the owner is being put in “a blacklist”. What does it mean? For the next 3 years, he or she will not be able to engage in entrepreneurship, including holding senior management positions.

The liquidation of a company must be approached systematically. It is better to assess possible risks in advance and make a smart decision. After all, a tempting opportunity to abandon an LLC does not waive future responsibility and carries with it even more problems than liquidation made on your own.