8 Things You Need to Consider Before Closing Your Business

Whether your business is new, or you’ve been at it for many years, there comes a time when you know it’s run its course. It is usually a difficult decision to close your business, but when you feel in your gut that it’s right, you need to plow through. But there are many things you need to consider before you can move on to the next part of your life.

The list below is a summary of some of the most important considerations when it comes time to closing your business.

File a dissolution notice

If you are closing your business, and if it is registered, you need to file a notice of dissolution with the Corporate Registry in your province.

Notify your employees

The decision to close your business will be difficult for your employees as well. You will need to let them know and give them ample time to make plans. Assure them that they will be paid for their work, and determine a reasonable plan for all parties to move on. Make sure you wind up your payroll accounts and send all CPP contributions, EI premiums and income tax deductions to your tax centre, no later than seven days before your business is scheduled to close.

Make your final tax payments

Submit your final tax forms due right up to the time that you will be closing your business. You also should make sure that you close your HST account.

Close bank accounts

Make sure that you close out your business bank account, along with credit cards or any other accounts associated with your business.

Take stock of your inventory

If you have a business that stocks inventory, you probably want to determine a plan to liquidate. Consider having a ‘going out of business’ sale or sell your outstanding inventory to a 3rd party.

Cancel your business name

If you do not cancel your business name, in some ways, it is as though your business persists. Make sure you dissolve your business, cancel your name and close out all of the associated CRA and provincial tax accounts.

Pay off any outstanding debts

You are wiping the slate clean and you want to make sure that all of your financial obligations are resolved before you actually close your business.

Leave contact information

Vendors, business contacts and associates will all want to locate you even after your business closes. And in many cases, those relationships will be important for you to nurture. Make sure the people who matter know where to find you and are alerted in advance to the close of your business.

Henry Wadsworth Longfellow once said, “Great is the art of beginning, but greater the art is of ending.” While closing your business may represent the end of an era, you can make sure it is done gracefully, respectfully and responsibly.

If you are closing your business and you need help, contact Miller Bernstein today.

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