Consequences of letting a company rotten

[NicolasMaduro]

I have a company in Bulgaria that I haven't bothered to do anything about. No activity in the company.

Now I can choose to pay 1100 EUR to a lawyer dissolve it in the right way, or I can leave it.

What are the potential consequences of doing nothing and letting their court system dissolve the company.

I dont have any intention of going to Bulgaria, so I wonder if its not just waste of money to pay for a proper
dissolve of the company.

 

[Martin Everson]

If you live in EU just close it properly. You don't want issues or penalties for failure to file Annual tax return or VAT returns etc. Think the fine can be up to BGN 3,000 for failure to file which is more than your 1100 EUR bla-"!. Plus they can chase you if you reside in another EU country

If you live outside EU then its your call bla-"!.

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Please note my posts should not be taken as financial or tax advice. Please seek professional advice in that respect.

 

[Sols]

I can't think of a single good reason not to close a company properly. It's a small price to pay for the peace of mind of having properly wound the company down.

It might come back to haunt you if in the future a financial institution (bank, payment processor) looks you up and finds you were the director of an abandoned company. You can explain yourself out of such a situation in most cases, but not having to worry about it at all is better.

You can try looking around for a cheaper service provider to dissolve the company, though.

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This is the probably the answer to your question.

 

[12345]

It actually happened to me I was quite surprised

Sols said:
It might come back to haunt you if in the future a financial institution (bank, payment processor) looks you up and finds you were the director of an abandoned company.
Click to expand...

 

[Willblack]

NicolasMaduro said:
I have a company in Bulgaria that I haven't bothered to do anything about. No activity in the company.

Now I can choose to pay 1100 EUR to a lawyer dissolve it in the right way, or I can leave it.

What are the potential consequences of doing nothing and letting their court system dissolve the company.

I dont have any intention of going to Bulgaria, so I wonder if its not just waste of money to pay for a proper
dissolve of the company.
Click to expand...

They will never close it down automatically, you are obliged to file an annual report or an inactivity declaration.

The dissolution process is a pain and takes months.

Your best bet is just to file your yearly inactivity declaration with the company register, it's free.

 

[Martin Everson]

Sols said:
It might come back to haunt you if in the future a financial institution (bank, payment processor) looks you up and finds you were the director of an abandoned company.
Click to expand...

I agree.

I remember I had to fill out a job application decades ago and was asked questions along the following lines:

1) Are you or have you ever been a director of a company?
2) Is the company active, voluntarily dissolved or struck off?
3) If it was struck off please explain the reason why? 😕

It could definitely come back and haunt you in this era.

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Please note my posts should not be taken as financial or tax advice. Please seek professional advice in that respect.

 

[JustAnotherNomad]

Have you checked if there is a cheaper company liquidator service?
In some countries, they can buy your company, put in some random new directors from a land far away and then it's no longer your responsibility if they don't file the reports.
But I guess it won't work if Bulgaria requires a company to have local directors.

Probably also not worth it if it's just 1k to close it the proper way.

Last edited: Jul 14, 2021

 

[tyrexoid]

lol I just realized I have abandoned non-profit in Estonia from years ago... do I need to bother closing it? I actually forgot about it after no longer was using it ....

 

[Martin Everson]

tyrexoid said:
lol I just realized I have abandoned non-profit in Estonia from years ago... do I need to bother closing it? I actually forgot about it after no longer was using it ....
Click to expand...

Investigate its current status and clean it up if anything is outstanding paperwork wise if your name is all over the non-profit.

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Please note my posts should not be taken as financial or tax advice. Please seek professional advice in that respect.

 

[kkein]

how about selling it over closing it? are there any negative sides about taking that approach?

 

[tyrexoid]

btw could be fun to sell a non-profit in my case hap¤#"

 

[NicolasMaduro]

Thank you for your inputs Ive transfered the EUR to my Bulgarian law firm Yesterday and they will close it properly

I think Selling it or insert other director is also a solution. But it doesnt look good if it thereafter goes bankrupt.

 

[kkein]

NicolasMaduro said:
Thank you for your inputs Ive transfered the EUR to my Bulgarian law firm Yesterday and they will close it properly

I think Selling it or insert other director is also a solution. But it doesnt look good if it thereafter goes bankrupt.
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whats the problem if it goes bankrupt after you sell it?

 

[NicolasMaduro]

kkein said:
whats the problem if it goes bankrupt after you sell it?
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not a problem just looks bad because u are assocaited as foundero f the company

 

[uplana]

I would just leave it, there may not be any personal liabilities unless you have made this specific for the company.

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[Martin Everson]

He has already paid for it to be wound up properly. See what he wrote.

NicolasMaduro said:
Thank you for your inputs Ive transfered the EUR to my Bulgarian law firm Yesterday and they will close it properly
Click to expand...

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Please note my posts should not be taken as financial or tax advice. Please seek professional advice in that respect.