The liquidation of a company ends with the determination of a result and its possible distribution. It is called the liquidation result. There are two methods to determine this. One is to add items in the balance sheet, while the other is a subtraction. Here are the applicable rules.
The operations to be carried out before determining the liquidation result
Before you can determine the final outcome of a liquidation, you must first dissolve the business and complete all liquidation operations.
Is equivalent to sell all assets still present in the company on the day of the dissolution. These are mainly stocks and equipment.
It should also be collect all trade receivables that is, to collect pending invoices. With the funds collected, it is necessary to pay off the company’s creditors and therefore pay customer invoices.
It is only once all these operations have been carried out that it is possible to proceed to the calculation of the final liquidation result.
As of this moment, the balance sheet includes, in principle, only cash (assets) and equity (liabilities).
The methods of calculating the liquidation result
Two methods are used to determine the result of a liquidation. The first is to add several liability items on the balance sheet. The second, on the contrary, is a subtraction between the positions.
In the first method, it is necessary to add all the reserves, the possible retained earnings (profit or loss) and the liquidation result (positive or negative).
In the second method, you simply take the total amount of equity in the business and subtract the amount of share capital from it. This is the easiest method.
When the result is positive, we speak of liquidation bonus. The partners will then recover more money than the funds they have invested in the capital of the company.
Conversely, if the result is negative, they will lose all or part of their contributions. We call this result a liquidation mali.
The distribution of the liquidation result
Once determined, the liquidation result must be distributed among the partners. Ventilation is generally carried out at pro rata of each participant’s participation.
Thus, the surplus is distributed and is analyzed, from a tax point of view, as a dividend. It is first subject to a sharing right at the rate of 2.5%. Individuals can benefit from the single flat-rate levy of 30% or opt for the progressive scale.
Finally, it should be noted that one-person companies (SASU and EURL) having a legal person as their sole partner – that is to say another company – are not liquidated. A universal transmission of assets (TUP) takes place.
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