We guide through all stages of liquidation of the company: we prepare necessary corporate documents for liquidation, assist in notifying the public register, tax authorities, help the company handling the settlement of all outstanding legal liabilities and otherwise ensure the regulatory compliance of the whole liquidation process.
The whole procedure of liquidating a Lithuanian company may take from one month to one year, which depends on the size of a company, its financial standing, whether tax authorities decide to inspect the records of the company its liquidation.
Knowledge & Insights
Lithuanian laws do not impose any specific requirements that need to be met in order to initiate the liquidation of a company. Nevertheless, it is advisable to review as to whether the annual financial statements of a company were duly filed to the Register of Legal Entities, whether any overdue tax declarations have been prepared and filed to the relevant tax authorities, review the commercial contracts and consider whether any business partners may invoke remedies and claim for damages for the premature termination of relevant commercial contracts.
The meeting of the shareholders must take place in which the resolution to liquidate a legal entity and appoint a liquidator (or the liquidation commission) is adopted. A servicing agreement with a liquidator has to be signed. The liquidator must set up a balance of the company as of the commencement date of the liquidation period. Moreover, the public announcement of a company under liquidation has to be made and the Register of the Legal Entities has to be also notified about the decision to liquidate the company. As a result, the company acquires the status of a company undergoing liquidation.
The tax authorites may carry out the inspection of a legal person under liquidation. Such inspection is, however, not always conducted and it depends on the business activities of the company, duration of the operational period, tax obligations of such entity, human resources available for tax authorities etc.
Termination of employment contracts
In the course of liquidation employment contracts must be terminated and all payments related to the employment contract, social, health insurance premiums, fines, etc.) have to be made. Aside from paying the employees the balance of the wage with the compensation for the unused time of annual vacations, each employee dismissed by reason of liquidation shall have a right to a severance pay in the amount of his average monthly wage taking into account the continuous length of service of the employee concerned at that workplace.
Before the company is deleted from the public register, a liquidator of the company has to undertake the following actions:
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