Service Overview
Focused legal support for corporate dissolutions & wind-ups
Closing a business involves more than stopping its operations. A corporation is a separate legal entity, and ceasing to trade does not, by itself, bring its legal existence to an end.
Corporate dissolution is the formal process of ending that existence. Winding up involves dealing with the corporation’s affairs, including its debts, liabilities, taxes, and remaining assets. The appropriate steps depend on the corporation’s circumstances and whether it is incorporated provincially or federally.
The dissolution and wind-up process
An orderly closure may involve:
- Corporate authorization: Preparing the director and shareholder approvals required for the proposed wind-up and dissolution, whether through meetings or written resolutions.
- Debts and liabilities: Identifying creditors and outstanding obligations, addressing any required notices, and arranging for debts and other liabilities to be dealt with before assets are distributed.
- Tax filings and clearances: Coordinating with the corporation’s tax advisers on final returns, outstanding HST and payroll remittances, and applicable CRA clearance certificate requirements before distributing corporate property.
- Remaining assets: Addressing any distribution to shareholders after the corporation’s obligations have been dealt with, taking account of the rights attached to each class of shares and the applicable legal requirements.
- Articles of dissolution: Preparing and filing the necessary dissolution documents with the Ontario registry or Corporations Canada, as applicable.
Why legal guidance matters
Allowing a corporation’s filings to lapse does not resolve its outstanding obligations. An incomplete wind-up or an improper distribution of assets can create legal and financial risks for the corporation and, in some circumstances, its directors, shareholders, or other responsible persons.
Legal guidance helps identify the requirements that apply to the corporation and the order in which they should be addressed. It also helps assess potential personal liability based on the circumstances of the closure.
How we can help
Our office assists with:
- Corporate resolutions: Preparing the director and shareholder documents required to authorize the closure.
- Wind-up requirements: Guiding clients through the treatment of debts, liabilities, and remaining assets, with attention to the risks associated with premature distributions.
- Government filings: Preparing, reviewing, and submitting articles of dissolution to the appropriate provincial or federal registry.
Who may need dissolution and wind-up assistance
- Retiring business owners who plan to close the business rather than sell it.
- Entrepreneurs and business partners moving on after a corporation has stopped operating.
- Owners simplifying a corporate structure by closing a subsidiary or holding corporation that is no longer needed.