How to liquidate a SIA (LLC)? What is the plan of action for the liquidation of a company?

The process of liquidation of a SIA (LLC) can be launched either by the sole decision of one of the shareholders, or by a majority vote among all shareholders of the company, if this is provided for by the articles of association of the company.

After the decision on the termination of business activity and the start of the liquidation of the company, a liquidator is appointed from among the members of the board of SIA (LLC), whose signature on the decision on liquidation is notarized and submitted to the Register of Enterprises along with an application for the beginning of the liquidation process. The Register of Enterprises, in turn, independently publishes information for potential creditors about the beginning of the liquidation process of the SIA (LLC) in the gazette “Latvijas Vēstnesis”.

After complying with all the procedures provided by law, the company can begin the process of dismissing employees due to the liquidation of the SIA (LLC).

For this it is necessary to:

• Prepare a notice of termination of the employment contract;
• Warn the employees about the dismissal no later than 1 month in advance;
• Obtain the signature of employees on the notice of termination of the employment contract;
• Pay all employees a severance pay in the amount of:
  • a monthly salary if the employee's employment time in the company does not exceed 5 years;
  • two months' salary if the employee's employment time in the company exceeds 5 years.

In parallel with all the processes of liquidation of SIA (LLC) through the implementation of operational activities, a member of the board is obliged to:

• Terminate contracts with partners SIA (LLC);
• Carry out mutual settlements with creditors;
• Pay tax payments.

A month after the publication in Latvijas Vēstnesis of the announcement of the beginning of the liquidation of SIA (LLC), subject to compliance to all procedures and norms provided for by law, the liquidator prepares a liquidation balance sheet (financial statement), as well as a plan for the division of property of the SIA (LLC) between the shareholders, indicating the share, which is due to each shareholder. The division of property between the participants itself is carried out not earlier than 2 months after the submission of all the necessary documents, but with the consent of all participants, the division procedure can be performed earlier than the specified period. Having divided the property, it is necessary to submit the liquidation balance sheet of the SIA (LLC) to the SRS and transfer all the company's documents to the archive.

If the State Revenue Service has no claims against the SIA (LLC), the liquidator submits an application for the completion of liquidation to the Register of Enterprises, which, in turn, on the basis of the decision made, makes an entry on the liquidation of SIA (LLC) in the Register of Enterprises.

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If You have questions regarding liquidation of a company, contact us. More detailed information can be obtained via e-mail mail@l2bmanagement.com or by telephone: +371 67373020.