Suspension or liquidation of an individual entrepreneur activity or company in Czech Republic

You have decided to terminate your business in the Czech Republic for one reason or another. What do you need to know?

As an individual entrepreneur, you have two options available to you:

1 - suspension of business activity

2 - ending the individual entrepreneurship

The suspension of sole proprietors in the Czech Republic has no time limits. All you need to do is notify the government agencies:

Pension fund

Taxation authority

Medical fund of state insurance (in certain cases)

In case of cancelation of business activity, it is necessary to notify the authorized body. Other authorities as in the case of suspension will be notified automatically except for taxation authority.

It is important to remember that cancelation means not only the stoppage of commercial activities, but also the settlement of all financial relations - repayment of debts, registration of profits, and so on.

Companies in the Czech Republic can not suspend their activities, founder of the enterprise may resign from authority and obligations, in two ways:

1 - liquidation of the company

2 - without liquidation, by replacing the founders

The liquidation process takes place under the supervision of the liquidator, who actually becomes the head, with the entry into the liquidation process. The liquidation of the company can be voluntary or compulsory.

Company can be liquidated involuntary under the court's decision and in this case the liquidator is appointed by the court.

Voluntary liquidation of the company is carried out by a decision of at least two-thirds of the votes of all partners, they also appoint a liquidator.

The liquidation of the company requires the preparation and fulfillment of a number of obligations:

settle relations with creditors, if any

preparation and submission of the final tax report

preparation of the liquidation balance sheet and others

The liquidation of the company is considered completed after its exclusion from the Commercial Register.

The non-liquidation method involves making changes to the company's registration data - re-registration of the company.

This method does not require the collection of a large package of documents, as in the case of the liquidation of the company, and it is also more financially viable.