How to close a company for economic reasons

The process to close a company depends on the characteristics that were adopted in its constitution. To determine how a company should be closed for economic reasons must be taken into account if it is a self-employed or individual entrepreneur, or on the contrary, is a commercial company. That's why in .com we explain in detail how to close a company for economic reasons .

How do you close a company of an autonomous for economic reasons?

The individual or autonomous entrepreneur has to follow different steps to be able to liquidate and, subsequently, close the company on which he bases his work.

These steps are:

  • Make a list of the debts you have contracted and pay them before the final closure of the company.
  • Make an inventory of the assets you have in your name and liquidate them.
  • If the self-employed person has workers under his / her responsibility, they must be dismissed paying the corresponding compensation to each one of them. The individual entrepreneur can avoid paying the compensation in case he does not have money and justifies it in the dismissal letter.
  • Unsubscribe as self-employed (in the offices of the Social Security) and in the Industrial Registry (as a definitive withdrawal).

How is a mercantile company closed for economic reasons?

The regulations associated with commercial companies stipulate that one of the causes of closure of a company may be that the capital of the company is reduced so much that it is less than half of the social capital with which it was founded.

If the closing is due to economic causes, the steps that the mercantile society must follow are the following:

  • Call for a General Meeting, in ordinary or extraordinary session, to discuss the cessation of business activity.
  • As soon as the agreement to dissolve the company is taken, an inventory of the assets that the company has to carry out its subsequent liquidation must be made.
  • It is important that the company pays all the debts it has contracted, because, if not, it should start the phase of bankruptcy, where the assets of the company will be settled for the payment of debts and liability will be determined that the administrators have about the debts contracted.
  • When the company has liquidated all its assets and paid all its debts, it must notify the Mercantile Registry of the end of its business activity and the closing of the company.
  • Once the company has been liquidated, the end of the activity must be reported to the Census of entrepreneurs of the Tax Agency. Each autonomous community has its own census.

It is necessary to raise the dissolution of the mercantile company to a public document, which means that the intervention of a notary is required.

Special consideration: Compensation for dismissal

One of the most problematic points that should be dealt with in a company closing for economic reasons is the dismissal of the workers who carry out their work within the company.

The compensation for this type of dismissal is 20 days of salary per year worked, establishing a limit of 12 monthly payments.

The law provides that the employer can avoid the payment of compensation as long as they do not have money and this is stated in the letter of dismissal. The worker will not remain without receiving compensation for dismissal since FOGASA is responsible for the payment of compensation in this type of case.