How to liquidate a company (s.r.o.) in the Czech Republic yourself: a step-by-step guide

Unfortunately, the process of liquidating a company in the Czech Republic is currently very complex and costly in terms of base expenses alone (notary and administrative fees, accounting services - and that is before our own costs) - these are the legal requirements in the country. Below, we have prepared a detailed guide on a Czech company dissolution. This guide will help you navigate the process if you decide to attempt this on your own. However, we should mention that if you have no prior experience in this area, it will be quite difficult to manage (no offense).

Additionally, the dissolution of a company in the Czech Republic must be handled by a specific person – “the liquidator” ("likvidátor"), who must meet the following requirements:

• Be fluent in the Czech language, with the ability to prepare official documents in Czech and communicate with all government authorities.
• Ideally reside in the Czech Republic, as they may need to personally represent the company during the all process at various government offices.
• Have access to Datová schránka ("Datová schránka"), which is difficult to get if the liquidator is not physically present in the country.

As you can see, if the person is not physically present in the Czech Republic and has no understanding of the local environment, we highly doubt they will be able to successfully complete the entire procedure on their own.

Now, let’s move on to how to actually proceed.

Step 1: Founders’ decision to dissolve the company & appointment of a liquidator

The starting point in the company liquidation process is the founders' decision to dissolve the company. This decision must be formalized in a notarial deed("Notářský zápis" ), issued by a Czech notary. This document will specify that the company has entered the dissolution process, with this fact recorded in the Czech Trade Register ("Obchodní rejstřík" ), and the liquidator who will oversee the entire procedure is appointed.

To formalize the decision to liquidate the legal entity, the company's founders must either appear in person before a notary or be represented through power of attorney. Typically, the person appointed as liquidator also acts as the founders' representative under a power of attorney when signing this decision.

Once the liquidation protocol is prepared, the notary immediately records this fact directly in the Czech Trade Register. From that moment onward, the company is officially undergoing dissolution procedure, and the suffix "v likvidaci" is added to its legal name at all times.

The base cost of this step is approximately 300-400 EUR (7000-10000 CZK), covering the notary's services for drafting the protocol and associated expenses.

The process typically takes 1-2 weeks, depending on how quickly the documents are prepared and how promptly the notary responds.

Step 2: Tax authorities, notifications and financial obligations review

This stage involves fundamental and arguably the most extensive work related to reporting, settling the company's obligations, and notifying relevant parties about the company's liquidation process:

• Balance sheet and tax report must be prepared as of the date preceding the notarial liquidation protocol and submitted to the state tax authorities. This task requires engaging a professional accountant who is familiar with the Czech procedures.
• All creditors of the legal entity must be directly notified that the company has entered dissolution procedure, and if they have any financial claims, they should inform legal entity promptly.
• Official publication of the company's dissolution in publicly available sources. In the Czech Republic, this obligation is fulfilled by publishing on a specialized platform called "Obchodní Věstník". The legislation requires at least two publications about the firm liquidation, with a minimum interval of two weeks between them, followed by a three-month waiting period after the second publication. During this timeframe, any creditors of the company may file financial claims if they exist – this waiting period specifically serves this purpose. This publication requirement significantly influences the overall timeline for company liquidation, as it essentially creates a 3.5 month waiting period even in ideal scenarios where no creditors submit claims against the company.
• Cancellation of official registrations with various government authorities. This includes removing employees from payroll systems and social and health insurance registries (správa sociálního zabezpečení and VZP), terminating VAT registration ("DPH") and cancelling any customs registrations ("celní správa"). The specific list of the requirements varies depending on the company's operational history and business activities. Companies that were inactive typically have no such registrations to cancel. This step primarily applies to firms that were operationally active, conducted business, and employed staff.
• Termination of all active contracts and settling of any remaining financial claims.

The primary goal of this step if to verify whether the company has any outstanding financial obligations or claims from third parties.

The base cost of this step is 250-400 EUR (5500-10000 CZK). This includes accounting fees for preparing the report, publication fees, and additional document expenses. The cost is very approximate and may vary based on the company’s operational activities.

The process typically takes 4 months, mainly due to the mandatory publication period in official sources.

Step 3: Final documentation preparation

After completing the mandatory 3.5-month publication period in Obchodní Věstník, we can proceed to prepare the final documentation package. This package will include:

• Liquidator’s report ("Zpráva o likvidaci"), which provides a detail report on all identified company obligations and their settlement, as well as the liquidator’s proposal for distribution of liquidation surplus.
• Final balance sheet and tax report. These documents must be submitted to the state tax authorities. We strongly recommend engaging a professional accountant with specific expertise in Czech liquidation procedures.
• Filling an application with the Czech tax authorities to obtain their approval for the company’s dissolution. Upon processing this application, the tax authorities issue the official liquidation consent document ("Souhlas správce daně s výmazem právnické osoby z Obchodního rejstříku")

The base cost of this step is approximately 200-300 EUR (5000-7500 CZK).

The process typically takes 2-3 weeks, depending on how quickly you submit all the documents and the response times of Czech authorities.

Step 4: Final application for company removal from the Trade Register

Once all documents have been prepared, we proceed with filing the final application to remove the legal entity's information from the Trade Register ("Obchodní rejstřík"). This application must be accompanied by all required supporting documentation. The complete set of documents is submitted to the relevant Commercial Court ("Obchodní soud") that maintains the company's records (typically determined by the company's legal address).

Final list of documents to prepare:

• Application for deletion from the Register ("Návrh na výmaz zápisu v obchodním rejstříku", electronic forms are available on the Czech Ministry of Justice website)
• Czech tax authority’s consent for company liquidation ("Souhlas správce daně s výmazem právnické osoby z Obchodního rejstříku")
• Proof of the mandatory announcements of the company's dissolution in publicly available (the above-mentioned "Obchodní Věstník")
• Initial balance sheet and final balance sheet
• Administrative fee payment confirmation (5000 CZK)

After submitting all required documents, we await the decision from the Commercial Court to which the application was submitted. The authorities will review the submitted documents, and if additional information is required, both the company and the liquidator will receive an official notification.

If the Commercial Court reaches a positive decision, it will issue an official liquidation approval order and will remove the company's information from the Czech Trade Register.

The base cost of this final application submission stage is 200-250 EUR (5000 – 6000 CZK). This includes the administrative fee and additional minor expenses for document preparation and certification.

The company liquidation procedure in the Czech Republic is now complete – as you can see, the procedure is quite complex. We should clarify that this description covers relatively straightforward cases (involving companies with minimal operational activity, which represent the majority of cases in our practice). For more complex scenarios involving actively operating companies, additional requirements may arise.