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What the law requires
A corporation does not end just because the business stops. Until it is dissolved, it still has to file its annual returns, keep its records and meet its tax obligations. Voluntary dissolution is the orderly way to close it, and it is part of the corporate work we do for owners who are retiring, restructuring or have simply finished with a company. Part XVI of the Business Corporations Act (the OBCA) sets out the steps, and our corporate law page shows how it fits with the rest of a company’s life.
Section 237 lists who can authorize a voluntary dissolution:
- The shareholders, by special resolution at a meeting called for the purpose. For a corporation that is not an offering corporation, the articles may set a different proportion of the votes cast, but not less than 50% of the votes of all the shareholders entitled to vote at the meeting (section 237(a)).
- All the voting shareholders, in writing (section 237(b)).
- All the incorporators, or their personal representatives, if the corporation never commenced business and never issued any shares (section 237(c)).
Section 238(1) then requires the articles of dissolution of an active corporation to state that the dissolution was properly authorized, that it has no debts, obligations or liabilities or they have been provided for or its creditors consent, that after satisfying its creditors it has no property left to distribute or has distributed its remaining property rateably among its shareholders according to their rights, that it no longer owns any land in Ontario if it ever did, and that no court proceedings are pending against it.
How to dissolve a corporation, step by step
- Stop trading and collect what is owed. Close out contracts, collect receivables and sell or transfer the assets.
- Deal with every debt. Pay them, provide for them, or get the creditors’ consent (section 238(1)(c)). If a creditor cannot be found, section 238(3) lets the corporation, by agreement with the Public Guardian and Trustee, pay the amount owed to the Public Guardian and Trustee to hold in trust.
- Give up any Ontario land. Articles of dissolution must confirm the corporation is no longer a registered owner of land in Ontario (section 238(1)(d.1)), and section 239(1.1) lets the Director refuse to endorse the articles if it is.
- Distribute what is left. Remaining property goes rateably to the shareholders according to their rights (section 238(1)(d)). If a shareholder cannot be found, section 238(4) allows their share to be delivered to the Public Guardian and Trustee, which holds it for them; under section 238(6), it can be claimed within ten years. Your accountant should advise on the tax effect of any distribution before it is made.
- Bring the records and filings up to date. File any outstanding annual returns and notices, described in what annual filings an Ontario corporation has, and keep the minute book in order.
- Authorize the dissolution. A special resolution at a meeting, or the written consent of all the voting shareholders (section 237).
- File articles of dissolution. Ontario’s registry services page says you can file articles of dissolution online, with the corporation’s name, its Ontario Corporation Number, the effective date of dissolution, Ministry of Finance consent if applicable (the request is forwarded automatically) and a fee of $25.
- Wait for the Ministry of Finance consent and the certificate. Ontario’s fee page says dissolutions require Ministry of Finance consent, which the ministry provides electronically within 30 business days of receiving the request from the registry. Under section 239(1), the Director then endorses the articles with a certificate of dissolution.
| Route | Who starts it | Government fee and service time (ontario.ca) | OBCA section |
|---|---|---|---|
| Voluntary dissolution, active corporation | Shareholders, by special resolution or unanimous written consent | $25; online 2 business days, mail 15 business days; plus Ministry of Finance consent, up to 30 business days | 237(a), (b), 238(1), 239 |
| Voluntary dissolution, never active | All incorporators | As above | 237(c), 238(2), 239(2) |
| Voluntary winding-up | Shareholders, by special resolution, with a liquidator | $25 for each of the two filings | 193 |
| Dissolution for default (filings, fees or taxes) | The Director, after a 90-day notice | Not applicable | 241 |
| Revival after dissolution for default | Any interested person, within 20 years | $330 | 241(9), (12) |
What changes the answer
Dissolution for default instead
Some owners simply stop filing and wait for the province to close the company. The OBCA does provide for that: section 241(3) lets the Director give notice that the corporation will be dissolved unless, within 90 days, it complies with a Corporations Information Act filing requirement or pays a required fee, and section 241(1) does the same for defaults under listed tax statutes once the Minister of Finance notifies the Director. But the consequences are worse than a voluntary dissolution, mainly because of what happens to property the company still owns.
Property left in the corporation
Under section 244(1), any property of a dissolved corporation that has not been disposed of on the date of dissolution immediately forfeits to and vests in the Crown, subject to the exceptions in sections 242 and 244. A bank account, a vehicle or a piece of land left in the company’s name does not pass to the shareholders automatically. That is the main reason to distribute everything before dissolving.
Claims after dissolution
Dissolution does not wipe out claims. Section 242(1) lets proceedings that started before dissolution continue, and allows new ones to be brought against the corporation as if it had not been dissolved. Under section 243(1), each shareholder who received property on the distribution is liable to anyone claiming under section 242, up to the amount they received. A dispute of that kind needs separate advice.
Changing your mind
A corporation dissolved for default can be revived under section 241(9), on the application of an interested person, including a director, officer or shareholder, within 20 years of the dissolution (section 241(12)). Ontario’s fee table lists a revival at $330. Revival after a voluntary dissolution is a different question and should be checked before relying on it.
Selling instead of closing
If the business still has value, selling the shares or the assets may be better than dissolving. We compare the two in asset sale or share sale. Our page on buying or selling a business covers the process.
A corporation that never started
If the company was incorporated but never commenced business and never issued shares, section 237(c) lets all its incorporators authorize the dissolution, and section 238(2) lists simpler contents for the articles. Section 239(2) requires all the incorporators, or their personal representatives, to sign.
Example
For example, imagine Kim, who has run a one-person consulting corporation from Markham for twelve years and is retiring. She is the only director and holds all the shares. Over three months, she invoices her last clients, collects what is owed, pays the final supplier bills and the accountant, and transfers the company car to herself at a value her accountant has confirmed. Her accountant files the corporation’s last tax return and advises her on how to take out the remaining cash. The company has never owned land.
Kim brings the annual returns up to date, signs a written resolution as sole shareholder authorizing the dissolution, and the remaining cash is paid to her as the only shareholder. She then files articles of dissolution online through the Ontario Business Registry with the $25 fee; the request for Ministry of Finance consent goes automatically, and the ministry has up to 30 business days to respond. Because nothing is left in the company, nothing forfeits to the Crown under section 244(1). She keeps the minute book and tax records in case questions come up later.
Common mistakes
- Leaving money or property in the company. Undisposed property forfeits to the Crown on dissolution (section 244(1)).
- Forgetting land. The articles must confirm the corporation no longer owns land in Ontario.
- Filing before the debts are dealt with. The articles require a statement about debts and creditors.
- Letting the company dissolve for default. It can be revived, but property may already have forfeited.
- Distributing without tax advice. How remaining money comes out of the company has tax consequences for the shareholders.
- Throwing out the records. Proceedings can still be brought against a dissolved corporation, and shareholders can be liable up to what they received.
What to do this week
- List the corporation’s assets, debts, contracts and any land it owns or has owned.
- Check that its annual returns and notices are up to date.
- Talk to your accountant about the final tax returns and how remaining money should be distributed.
- Check the significant control register and other records are current; see the significant control register.
- Decide whether a sale might be better than closing.
- Find the minute book and confirm who the shareholders are, using the securities register described in what goes in an Ontario corporation’s minute book.
- Prepare the shareholders’ resolution and the articles of dissolution once the affairs are wound up.
- If you would like help closing the company properly, a first consultation takes 30 minutes, by video or in person, and you can request one here.
Frequently asked questions
How much does it cost to dissolve an Ontario corporation?
The government fee for articles of dissolution under the OBCA is $25, whether filed online or by mail, according to Ontario’s fee table. Professional fees are separate.
How long does it take?
Ontario’s fee table lists 2 business days online, or 15 by mail, once the filing is processed, and says the Ministry of Finance provides its consent within 30 business days of receiving the request. Winding up the company’s affairs beforehand usually takes longer than the filing.
Can I dissolve a corporation that still has debts?
Only if the debts have been provided for or the creditors consent, because section 238(1)(c) requires the articles to say so.
What happens to the company’s remaining money?
It should be distributed to the shareholders rateably, according to their rights, before dissolution (section 238(1)(d)). Anything left undisposed of forfeits to the Crown (section 244(1)).
Do the directors have any role?
Yes. They run the winding-up and must act honestly and in good faith in the corporation’s interests throughout, as explained in directors’ duties under the OBCA.
Is a federal corporation dissolved the same way?
No. A corporation under the Canada Business Corporations Act follows the federal rules, administered by Corporations Canada. The difference between the two is covered in Ontario or federal incorporation.
Sources
- Business Corporations Act, R.S.O. 1990, c. B.16, ss. 193 and 237 to 244
- Ontario.ca: Ontario Business Registry, all services (dissolving a corporation)
- Ontario.ca: Costs and service times (dissolution, winding-up, revival, Ministry of Finance consent)
This page is general information about Ontario law, not legal advice for your situation. It reflects the law as of October 26, 2026.