Winding Up a Business in Canada

Wind up, liquidate, or dissolve a Canadian based business with these easy template forms for Canada.

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Dissolution is the legal process for ending the existence of a corporate entity. The procedure for dissolving a Canadian corporation is governed by the Canada Business Corporations Act. Each province and territory has its own legislation for corporate entities formed within their jurisdiction.

The corporation's creditors must be paid, and the remaining assets (if any) can then be distributed to the shareholders. When all of the corporation's property and liabilities have been dealt with, an application for dissolution can be made. The company cannot be dissolved so long as it has assets or liabilities. Canada Revenue Agency must also be notified and a final income tax return filed.

A bankrupt corporation cannot apply for dissolution. If a company declares bankruptcy, the trustee must decide whether to liquidate the business' assets or to sell the business, whichever will generate more money to pay the company's creditors.

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