Types of associations
There are 3 types of associations:
- Association with full legal capacity
- Association with limited legal capacity
- Homeowners' association (Vereniging van Eigenaars, VvE)
This step-by-step plan applies to the association with full legal capacity. Do you have an association with limited legal capacity, but do you have articles of association? Then you can also use this step-by-step plan. You cannot simply dissolve a Homeowners' Association (VvE). As long as the apartment building exists, the owners of the apartments are obliged to remain members of the association. So, the association will continue to exist. Only when the apartment complex is demolished can the VvE be discontinued. In that case, you can follow the step-by-step plan for its dissolution.
Read more about the association.
1. Let the members vote on the dissolution
The articles of association contain an agreement on the dissolution of the association. The General Meeting of Members (ALV) makes the decision to dissolve. Usually, the decision to dissolve can only be made with a large majority of the votes in the meeting. That is usually two thirds of the votes. That means a minimum number of board members must be present. If you do not comply with the agreements in the articles of association, the outcome will not be valid.
2. Check the assets of the association
Does (the majority of) the members agree with the dissolution? Check whether the association has any assets.
The association has no assets
Does the association no longer have any assets? Then the association ceases to exist, immediately after the dissolution decision has been made. You must complete and submit the KVK form 17a (pdf) 'Dissolution of a legal entity'. KVK will then deregister the association. This fast way of dissolving and deregistering is called a fast-track liquidation, or turbo liquidation.
The association still has assets
Does the association have assets? Then you must first settle the assets of the association financially (liquidate). The members must appoint liquidators for this purpose. The liquidator(s) check the outstanding invoices and the money in the bank account. Then they draw up a final balance. The association must transfer the assets and pay the debts. Is there still an amount left? Then usually the articles of association specify that this must be spent on something that fits the purpose of the association.
Once the assets have been settled, the board will notify KVK of the dissolution. Use form 17a (pdf) 'Dissolution of a legal entity'. KVK will then deregister the association from the Business Register.
The association is in debt
Do you have to end the association due to excessive debts? Then explore your options with the debt flowchart on KVK.nl. The flowchart provides tips for dealing with short-term and long-term debt. For temporary debts, you can first apply for a suspension of payment. If the association has debts with the Tax Administration, you must report that you are unable to pay (in Dutch). If any debts remain and cannot be paid, the association must file for bankruptcy.
3. Deregister the association from the Business Register
After the debts of the association have been paid or the assets have been divided, you can deregister the association. Use form 17b, 'Termination of a legal entity'. Print the form, sign it, and send it to your KVK regional office. Include a copy of a valid proof of identity from the signatory of the form. Once KVK has processed the form, the association is deregistered. You will receive a confirmation of this. Deregistration is free of charge and can only be done by post.
4. Keep your business records
After the dissolution of the association, you must keep your business records for at least 7 years. In some cases, the retention obligation is 10 years. This depends on the type of information. You can read more information about this in the step-by-step plan for keeping business records. You may scan the paper administration and store it digitally. The name of the custodian of the administration is stated in the articles of association. Or they state that the members must appoint the custodian. When the association is deregistered, you or a deputy must register the custodian in the Business Register.
Extra steps if your association is a company
If your association makes a profit or strives for a profit, then you have a business. Then you should also follow the next steps.
1. Lay off staff
Do you employ staff or volunteers? Then there are rules you must adhere to when ending your association. If you have to dismiss staff, you must apply for a dismissal permit. You must record agreements in a social plan, such as a transition payment and assistance in finding new work. Also report the dismissal to the Tax and Customs Administration. What you need to report is stated in ‘Stap 17 einde van inhoudingsplicht of dienstbetrekking’ (Step 17 end of withholding obligation or employment) of the Payroll Taxes Handbook (pdf in Dutch)
2. Inform your staff and customers
If you have staff or volunteers, tell them first that you are going to close down your association. Your staff then has time to look for other work. Also check which contracts or agreements the association has with customers and suppliers. Only then let your customers and suppliers know that you are closing down. Read more about informing your customers on KVK.nl.
3. Submit your final VAT return
If your association has been deregistered, you will receive a letter from the Tax and Customs Administration stating that you must submit a final VAT return. When you have submitted the last VAT return, the Tax and Customs Administration will send you the final confirmation of deregistration as an entrepreneur for VAT purposes.
Also file a declaration if you have not yet been deregistered
Deregistration sometimes takes a while. In the meantime, do you receive a message from the Tax and Customs Administration that you may have to submit a VAT return? Then you have to submit that return.
4. Pay corporate income tax (vpb)
The Tax and Customs Administration will send you a letter confirming the deregistration from the Business Register. And announcing that you have to settle your tax affairs. This is called tax settlement. You must file a last corporate income tax return.