Transferring the land from Single Limited Company to the physical owner of the company and closing the company down
For the purpose of closing down the company, on the first place, the company must be kept up to date accountancy over the years – submitting tax return, publishing the financial reports in the Trade register, etc.
The transfer of the land from the Single Limited Liability Company to the physical person (in most of the cases it is the same person) must be done through a legal transaction- it could be sale purchase, donation, etc. If it is a sale purchase deal, the physical person must pay a purchase price to the company, although the owner of the company and the buyer of the land is the same person. The purchase price must be accounted from the company as an income of the company as well as the taxes over the purchase price must be paid from the company.
The sale purchase should be made before the Notary Public and the notary taxes also must be paid, although the owner of the land and the owner of the company could be a same person.
The process of closing down a Bulgarian company is not an easy process but a rather complicated procedure involving numerous actions before different authorities (public bodies). The first stage of this process is the dissolution of the company and appointing of a liquidator (which is usually the manager of the company).
The manager of the company should notify the Tax Office aboout the dissolution process and the Tax office issues a certificate under art. 77 of the Tax Code certifying that the company does not have tax obligations towards the State.
All documents related to the above actions should be presented before the Trade Register. If they are correctly prepared, the Trade Register should change the status of the company from “active company” to a ‘company in process of liquidation”. We strongly recommend all the documents for liquidation to be prepared by a lawyer.
The dissolution process should be finished within a specified deadline – a minimum of 6 months. The main goal of this time period is for the existing business relations between the company and third parties to be concluded and for the assets and shares to be divided between the shareholders.
After this deadline expires, the second stage of the liquidation process includes deleting the company from the Trade Register. The company is also obliged to present before the Trade Registry the specified in the Commercial Code accountancy documents. Upon receipt of all documents and a satisfactory check, the Trade register would erase the company’s entry from its records.
Prepared by “Valova and Angelova ”law firm