The liquidation of the LLC in accordance with the general rules involves the procedure for termination of the organization without transferring rights and obligations to another person. The liquidation process itself is quite complex and multi-stage, but it can be greatly simplified by using alternative methods of terminating the business. This may be a reorganization or liquidation of an LLC through a sale.
If you choose between these two methods, then you should choose a sale, since this particular method of elimination is considered the fastest and easiest. In addition, there are two ways to liquidate a business through a sale.
Features of Alternative Elimination
- The organization does not stop its activities. During the sale, the LLC does not close, its rights, obligations and work with contractors are not terminated. Only the composition of the participants is changing.
- The staff does not change. The new owner of the organization decides on the appointment of the head, but no rules oblige him to dismiss the current director. The same applies to officials and other employees: they do not lose jobs after the sale of the LLC, if this is not necessary.
- Liquidation of an LLC through a sale is fairly quick. The whole process takes less than a month, and the conclusion of an agreement on the sale is faster than the replacement of owners.
- The company is not subject to any checks, including tax, as with a complete disbandment. As the organization continues its activities, there is no need to conduct verification activities for the payment of tax fees and compliance with the law.
- At the end of the sales process, it is necessary to register changes in the Unified State Register of Legal Entities. Any steps are subject to mandatory state registration, including a change of ownership and CEO.
At first glance, an alternative way to liquidate a business is much simpler than a complete disbandment, however, there are some nuances here: first of all, this is what you need to find an interested buyer and know how to sell your LLC competently.
Conditions for liquidation
Liquidation of an LLC by sale is possible subject to the following conditions:
- The owners of the organization must draw up a competent agreement indicating all the necessary information. The contract should indicate the market value of the enterprise and list all assets. For the correct preparation of this paragraph, an inventory is required, after which both parties need to familiarize themselves with the results. If both parties agree on all points, then the sales agreement can be signed.
- If there are debts in the enterprise, it is necessary to notify the creditors of their plans, since the liquidation of the LLC with debts through the sale can be carried out only with their consent. If the owners ignore this condition, then in the future the transaction may be terminated, and creditors may collect debts through the court. Even if time has already passed after the sale, the creditor is entitled to make a claim.
- If the owner is legally married, then for the sale of the business will need to show the consent of the spouse. If the founder is not married, he will need to present an identification document.
- All co-owners of the LLC must write their consent to waive the pre-emptive right to acquire a business.
Only after compliance with all the above conditions, you can begin to draw up documents for the sale of LLC.
Liquidation of LLC through sale: advantages and disadvantages
The main advantages of an alternative elimination method are in the profitability and speed of the process. This method is popular and today, however, it is extremely difficult to conduct a transaction without the help of competent legal support. It is almost impossible to sell a business on your own. Accordingly, high costs will be required, but when compared with debts, the costs are very small.
The legality of the procedure is a moot point. If we are talking about the deliberate liquidation of LLCs with debts through fictitious transactions - of course, this method is illegal. But if the sale is carried out in accordance with the law, then there is no ban on the change of owners or on the sale of a legal entity, while the amount of debt obligations does not matter. The only point that cannot be circumvented if acting according to the law is the presentation of claims by credit organizations in the early stages of the procedure.
Risks and consequences
The main risks of liquidation through the sale of business arise from the shortcomings of the method itself:
- Selling a company, and thus getting rid of debt obligations, a businessman does not insure himself against liability for those obligations and violations that arose when he was the owner.
- When conducting the purchase and sale process of an institution as a property complex, it is necessary to notify the sale of creditors, otherwise the transaction may be declared null and void. And this means that you have to either “circumvent" the law, or pay debts in the process of the transaction.
- Since the liquidation of the LLC by sale is carried out with the assistance of an intermediary, it is highly likely that not all procedures will be followed or some legal norms will be violated. Be mindful of the choice of specialists who will carry out the liquidation operation.
Ways to sell LLC: step by step instructions
The sale of the LLC to other persons is not a liquidation in the direct sense of the word, since the organization has not stopped its activity, only the management has changed. This method of so-called liquidation takes only a few hours and is carried out by a notary public. After the sale is completed, all obligations for the company are transferred to the new owner.
The law provides for different methods of liquidation by sale:
- Liquidation of the organization by selling a share in the LLC to a third party.
- Sale by way of changing the owner and CEO.
Liquidation of an organization by selling a share
Liquidation of an LLC through implementation is much faster than the process of complete dissolution of the company, but in this case it is necessary to perform some procedures and adhere to the sequence of actions.
Necessary steps:
- Organize a meeting at which the decision of the founder of the LLC on the sale of the organization will be made and prepare an appropriate protocol.
- Coordinate all actions of the parties.
- Notify the sale of credit organizations.
- Prepare and agree on a sale agreement.
- Fill out and notarize the notary application form.
- Notarize the purchase agreement of the LLC.
- Issue an act of acceptance of the property of the company, including debt obligations and the authorized capital.
- Register the agreement with the relevant authorities and file an application with the tax authorities (this must be done before the expiration of the three-day period after signing the sale agreement).
The statement and the minutes of the meeting on the sale of LLC should be attached to the application. After submitting documents to the Federal Tax Service Inspectorate within a week, service employees will make changes to change managers in the Unified State Register of Legal Entities.
Change of leadership
Not sure how to sell an LLC? This method can be considered alternative, it is carried out by two methods:
- Conclusion of an agreement on the sale or execution of a contract of gift of shares to a new owner or owners. Such a sale can be considered urgent, the process takes place in one stage and does not require large expenses.
- Creation of an application for withdrawal from the LLC by distribution of shares between the parties. This method occurs in two stages:
- New members are introduced into the management of the company.
- Former participants voluntarily leave the LLC, the new owner or owners receive their share.
The CEO appointed by the new members assumes all responsibility for further actions of the company. If the procedure for selling the LLC was followed, all procedures were carried out without violation and subject to all conditions, there should be no complaints against the previous owners.
In parallel with the business liquidation procedure, it is necessary to re-register it, which implies making changes about the founders and the leader in the relevant state registers of relevant information.
The timing
Liquidation by selling LLC is considered urgent, as it takes a minimum period. If you correctly approach the process, then it will take no more than two weeks.
- The study of the documents of the owners, the preparation of the purchase agreement and other documentation takes 1-2 days.
- Paperwork at the notary - 1 day.
- Registration of changes by the tax authorities - at least 12 days.
Liquidation of an LLC through a sale takes 2-3 weeks, while the process of complete dissolution takes about six months.
Required documents
The list of documents for notarization includes:
- Contract of sale.
- Statement of owners.
- Certificate of registration of LLC.
- Constituent documentation.
- List of owners.
- Articles of association.
- Certificate from statistics authorities indicating OKVED codes.
- Passports of all participants in the transaction.
- Consent of spouses to the sale of LLC or prenuptial agreement with this clause.
- Extract from ERGUL (valid for no more than 3 days).
- State duty payment receipt.
Legal risks
Liquidation of a business through a sale is a legal procedure that involves certain risks. Because, the organization remains registered with the current TIN, only information about the founders and the name of the executive body are changed. After the transaction of the sale of LLC, the entire responsibility is transferred to the new management. In order to make changes to any aspect of the organization, to change the name or legal address, the new owner will need to spend a lot of money and time.
Conclusion
Selling a business as a means of liquidation is a simple and very quick procedure, however, if there are big debts and internal problems, it is better for the company owners to think about voluntary bankruptcy. Do not forget that even after the sale of a legal entity, unclosed liabilities to creditors may come up over time. Before making a final decision on the sale of LLC, think again whether this method suits you.