What is Dissolve a Corporation

“Dissolving a corporation” means formally closing down a corporation so that it no longer exists as a legal business entity. It’s the official way to end a business’s life under the law.

🧾 Why Dissolve a Corporation?

Businesses might choose to dissolve for several reasons:

• Failure to file Annual Return
• The company has fulfilled its purpose.
• Business is no longer profitable.
• Disputes between shareholders or owners.
• Reorganization into a different structure 
• Retirement or exit strategy.

Types of Corporate Dissolution

1. Voluntary Dissolution

Occurs when the corporation’s owners (shareholders) or directors decide to close the business. This is typically done when:

• The company is no longer profitable.
• The owners retire or move on to other ventures.
• The business purpose has been fulfilled.

2. Administrative Dissolution (Involuntary)

Happens when the province or territories  forcibly dissolves a corporation for failing to comply with legal requirements, such as:

• Not filing annual returns
• Not paying franchise taxes or fees
• Failing to maintain a registered agent

Effects of Administrative Dissolution:

• The corporation loses its legal standing.
• It can no longer sue or be sued in court.
• Owners may still be personally liable for unresolved debts.

3. Judicial Dissolution

Occurs when a court orders the corporation to dissolve, usually due to:

• Shareholder disputes (deadlock in management)
• Fraud or illegal activities
• Failure to meet corporate purposes

Consequences of Dissolving a Corporation

✅ Legal Protection Ends – The corporation can no longer shield owners from liabilities.
✅ Assets Must Be Distributed – After paying debts, remaining assets go to shareholders.
✅ Tax Obligations Continue – Final taxes must be filed, and any owed taxes must be paid.
✅ Revival May Be Possible – Some provinces allow reinstatement if dissolved accidentally.

Dissolution vs. Reviving a Corporation

• Dissolution = Permanently shutting down the business.
• Revival = Restoring a dissolved corporation (possible in some cases if done within a certain timeframe).

Steps to Dissolve a Corporation:

File Articles of Dissolution:

• Submit formal paperwork (often called “Articles of Dissolution” or “Certificate of Dissolution”) with the Government Registry. 

Resolve Debts and Liabilities:

• Pay off creditors.
• Settle any outstanding financial obligations.

Notify Tax (CRA) Authorities:

• File final federal and provinces tax returns.
• Pay any remaining taxes and get a tax clearance if required by your province.

Distribute Remaining Assets:

• After debts are paid, distribute any leftover assets to shareholders according to ownership percentages.

Cancel Licenses and Permits:

• Close business licenses, permits, and registrations.

What are included in our service?

✔ Governmental fees and  agency fees
✔ Preparing article of dissolution by our corporate lawyer.
✔ Submission of this article to government system by our licensed agent
✔ Step by step support over phone, live chat and email.