Why another BV structure?
We asked one of our clients to describe in his own words the path he took to dissolve multiple BVs. We see many of our clients having one or two BVs set up in the form of a holding company and operating company. Here are the steps taken:
One evening, I was scrolling through Facebook on my iPhone. I saw the ad from Dissolve BV and then I realised whether it made sense to leave my Limited Company holding structure and two operating companies intact with all the annual costs involved.
I asked myself the following questions, did I want to:
- Make those annual accounts every year?
- Pay the accountant?
- Do the annual VBP and quarterly VAT returns?
- Meet the deadlines for filing the annual figures?
This meant keeping time-consuming records and ledgers every year and quarter. I tried to do everything myself as much as possible to keep accountant costs down. It was facing a mountain every time. Besides keeping records myself, I had an accountant who still processed everything. Every extra hour was of course cash register.
Does a BV suit me?
And finally: does this legal structure still fit what I really want? The answer was a clear NO.I was actually a one-man business in disguise given my activities. Indeed, that’s what I wanted to be from the start. To be able to act simply and quickly with no overhead.
Of course, I had big plans and ambitions for which, in theory, a BV structure was good, but I was far from there. According to the accountant, a complex structure was the only solution for the future.
After years of waiting, I tied the knot to dissolve the BVs and continue as a sole proprietorship. To my mind, I thought it would be an extremely complex process that required a lot of time and energy to be put into before the entities could actually be dissolved.
I got in touch with Opheffen BV and they explained to me in minute detail the steps that needed to be taken to achieve a turboliquidation. This gave me air and an overview of the process.
After all, I first had to liquidate the balance sheets of the companies. This was something I really had to sit down for. It was March and the company had already paid bills a few months into the new year and I had paid money privately through a current account.
Using the bank statements for a whole year, I made an overview of the companies’ liabilities and the invoices I had paid in the previous months.
I put these in Excel and, step by step, started cancelling the contracts or converting them to private/business. In the process, I discovered that if I explained the situation honestly to my suppliers, they were also quick to cooperate.
BV termination is emotion
The annual accounts for 2016 had yet to be drawn up. It took some doing to get these in order in a hurry. That was a storm of work, but the good news is, every storm dies down once.
The annual accounts were ready and then it dawned on me: it was not just a formal matter, but also an emotional one. I had put more than 23 thousand euros into the company over the past few years, fully confident that a day would come when I could earn this money back.
Now the liquidating began, I entered the 2016 annual accounts into a free accounting programme as the opening balance sheet and entered this year’s operating company invoices into the system so that I had a very clear picture of how the companies were doing. Indeed, this allowed me to see exactly what I still needed to do to settle the balances.
The holding company acted merely as a holding company and an accounting conduit for money I deposited through the current account. The operating company had a debt to the holding company, I took stock of the amount and cancelled it through an agreement less the VAT refund (which served as a partial repayment of the current account, so to speak).
Then the holding company still had a debt to me as DGA, which I also cancelled, and again reduced by the VAT refund which was repaid from the operating company.The cash was also distributed as repayment of the debt.
Since I had prepared the financial statements on tax basis, I could quite easily do the VBP returns myself. I had repeated telephone contact with dissolve BV during that period. At each step, I did a check with them and found their clear language refreshing. This was an extra service on their part, considering you pay a fixed price and not by the hour.
After the liquidation and a signal to dissolve BV, I was sent all the legal documentation. All I had to do was sign and send it to the Chamber of Commerce. What a relief when I received notification from dissolve BV that my BVs had been deregistered. I am now a sole trader and that is a huge relief.
Tip: You cannot register a sole proprietorship at the same address of your BV until the BV is deregistered. You can register the sole proprietorship somewhere else in good time.