{"id":2275,"date":"2026-10-03T09:00:13","date_gmt":"2026-10-03T06:00:13","guid":{"rendered":"https:\/\/linden.lt\/tinklarastis\/liquidating-an-individual-enterprise-ij-lithuania\/"},"modified":"2026-10-06T08:56:48","modified_gmt":"2026-10-06T05:56:48","slug":"liquidating-an-individual-enterprise-ij-lithuania","status":"publish","type":"irasas","link":"https:\/\/linden.lt\/en\/blog\/liquidating-an-individual-enterprise-ij-lithuania\/","title":{"rendered":"Closing an individual enterprise (I\u012e) in Lithuania: steps and liability"},"template":"","kategorija":[],"class_list":["post-2275","irasas","type-irasas","status-publish","hentry"],"acf":{"visi_puslapiai_cta_statusas":false,"visi_puslapiai_cta_antraste":"","visi_puslapiai_cta_formos_id":"","visi_puslapiai_cta_papildomas_tekstas":"","visi_puslapiai_cta_nuotrauka":null,"tinklarastis_1_autorius":null,"tinklarastis_1_iraso_tipas":false,"dinamiski_blokai":[{"acf_fc_layout":"tekstas","tekstas":"<p>An individual enterprise (<em>individuali \u012fmon\u0117<\/em>, I\u012e) is liquidated by a decision of its owner. An I\u012e is liquidated on the same grounds and by the same procedure that the Civil Code sets for all legal entities: a liquidator is appointed, the liquidation is announced, the creditors are paid, and what is left goes to the owner. The main difference from a UAB or an MB is liability. An I\u012e is a legal entity with unlimited civil liability, so if its assets are not enough to cover its debts, the owner answers for the I\u012e's obligations with their own assets. The I\u012e ceases to exist when it is deregistered from the Register of Legal Entities (<em>Juridini\u0173 asmen\u0173 registras<\/em>).<\/p>\r\n<p>If you want to keep the business going but without unlimited liability, you do not have to liquidate. However, for I\u012e obligations that arose before the conversion, the owner remains liable on a subsidiary basis for three years (Article 2.104(2) CK). An I\u012e can be converted into a UAB or an MB (Article 11(1) of the Law on Individual Enterprises of the Republic of Lithuania, I\u012e\u012e). How that works is covered in <a href=\"https:\/\/linden.lt\/en\/blog\/converting-individual-enterprise-into-uab-or-mb-lithuania\/\">Converting an I\u012e into a UAB or MB: liability, assets, contracts, staff<\/a>.<\/p>\r\n<h2>Who liquidates an I\u012e and on what grounds<\/h2>\r\n<p>The decision to liquidate an I\u012e is taken by its owner (Article 6(5)(8) I\u012e\u012e). An I\u012e is liquidated on the grounds and by the procedure for liquidating legal entities set out in the Civil Code (Article 13(1) I\u012e\u012e). Article 2.106 of the Civil Code of the Republic of Lithuania (CK) lists those grounds exhaustively: a decision of the members, bankruptcy, a decision of a court or of the registrar, the end of the period for which the entity was set up, and the other cases named in that article.<\/p>\r\n<p>The registrar, the Centre of Registers (<em>Registr\u0173 centras<\/em>), can also initiate liquidation, for example where an I\u012e fails to file mandatory documents with the register within twelve months after the deadline, has had no registered office in the register for more than six months, or has not updated its data in the register for five years and there are grounds to believe it carries on no activity (Article 2.70(1) CK). What to do in that case is covered in <a href=\"https:\/\/linden.lt\/en\/blog\/centre-of-registers-initiated-liquidation-what-to-do\/\">Centre of Registers initiated liquidation: what to do<\/a>.<\/p>\r\n<p>From the day of the liquidation decision, the I\u012e has the status of an I\u012e in liquidation (Article 13(2) I\u012e\u012e).<\/p>\r\n<h2>Who the liquidator is and what they do<\/h2>\r\n<p>The owner who decides to liquidate must appoint a liquidator (Article 2.108(1) CK). Where the liquidation is on the registrar's initiative, no liquidator is appointed (Article 2.70(8) CK). The law requires the liquidator to have the necessary qualifications (Article 2.108(3) CK). The I\u012e\u012e does not prohibit appointing the owner as liquidator, so the liquidator can be the owner or another person, unless the I\u012e's articles provide otherwise (Article 2.108(2) CK). Whether that other person may be a legal person, the I\u012e\u012e does not say directly. The liquidator's name, surname and personal code are filed with the register (Article 13(4)(1) I\u012e\u012e), which suggests a natural person. But this is only an inference from the data filed with the register, and Article 2.108(3) CK uses the general word \"person\"; we found no case law on the point, so the question is not settled. From the day of appointment, the liquidator has the rights and duties of the I\u012e's manager (Article 13(3) I\u012e\u012e).<\/p>\r\n<p>Article 13(4) I\u012e\u012e sets out what the liquidator must do:<\/p>\r\n<ul><li>no later than on the day of the first public notice, inform the register of the liquidation decision, file the document confirming it and give their own details;<\/li><li>draw up the I\u012e's balance sheet as at the start of the liquidation period;<\/li><li>complete the I\u012e's obligations and pay its creditors;<\/li><li>make claims against the I\u012e's debtors;<\/li><li>transfer to the owner the assets left after paying the creditors and draw up a transfer certificate;<\/li><li>hand over the I\u012e's documents for safekeeping;<\/li><li>draw up the liquidation certificate and file it with the register together with the other deregistration documents.<\/li><\/ul>\r\n<p>The liquidation is announced publicly three times at intervals of not less than thirty days, or once together with written notice to all creditors (Article 2.112(1) CK). An I\u012e in liquidation can enter only into transactions linked to winding up its activities or provided for in the liquidation decision (Article 2.111 CK).<\/p>\r\n<h2>Who is liable for the I\u012e's debts<\/h2>\r\n<p>An I\u012e is a private legal entity with unlimited civil liability (Article 2(1) I\u012e\u012e). First, the I\u012e itself covers its debts with the assets it holds in ownership or in trust (Article 2.50(1) CK). If you are married, note this: assets you and your spouse own jointly and transfer to the I\u012e are held by the I\u012e in trust, unless the spouses agree otherwise (Article 8(4) I\u012e\u012e). So those assets are also used to pay the I\u012e's debts. But if the assets of a legal entity with unlimited civil liability are not enough to meet its obligations, its member is liable for those obligations, unless the law provides otherwise (Article 2.50(4) CK). For an I\u012e, that member is the owner.<\/p>\r\n<p>So before you decide to liquidate, check whether the I\u012e's assets will cover all its debts. If the I\u012e is liquidated by the owner's decision rather than in bankruptcy, and not all creditors are paid, the owner may remain liable for the I\u012e's debts even after the I\u012e is deregistered (Supreme Court of Lithuania ruling of 13 April 2010 in civil case No. 3K-3-159\/2010). But to enforce this, the creditor needs a court judgment or other enforceable document awarding the I\u012e's debt against the owner personally (Supreme Court of Lithuania ruling of 9 October 2015 in civil case No. 3K-3-510-313\/2015). Creditors are paid in the order set by the Civil Code (Article 2.113(1) CK). How that order works is covered in <a href=\"https:\/\/linden.lt\/en\/blog\/uab-liquidation-process-employees-creditors-audit-bank-account\/\">During a UAB liquidation: employees, creditors, audit and the bank account<\/a>.<\/p>\r\n<p>If it turns out during the liquidation that the I\u012e is insolvent, the liquidator must stop all payments and initiate bankruptcy proceedings without delay (Article 7 of the Law on Insolvency of Legal Entities, JAN\u012e). In an I\u012e bankruptcy, unlimited liability has direct consequences for the owner:<\/p>\r\n<ul><li>within the time set by the court, the owner must give the insolvency administrator a list of all their own assets, including property held in joint ownership (Article 57(2) JAN\u012e);<\/li><li>the owner's assets can be sold only once a court ruling ordering recovery from those assets has become final (Article 88(1) JAN\u012e).<\/li><\/ul>\r\n<p>The assets left after the creditors have been paid belong to the owner: the owner is entitled to the assets of the I\u012e in liquidation that remain after the creditors have been paid (Article 6(6)(4) I\u012e\u012e).<\/p>\r\n<h2>What happens if the owner dies or loses legal capacity<\/h2>\r\n<p>The owner's death is not a separate ground for liquidation: it is not on the list in Article 2.106 CK. An I\u012e is inherited under the Civil Code (Article 10(1) I\u012e\u012e). Until the heirs divide the estate, interested persons can ask the court to appoint an estate administrator for the I\u012e. The administrator has the rights and duties of both the owner and the manager (Article 10(3) I\u012e\u012e).<\/p>\r\n<p>Only a natural person can own an I\u012e (Article 6(2) I\u012e\u012e), and an I\u012e owner cannot own another I\u012e (Article 6(3) I\u012e\u012e). If the I\u012e is inherited by a person who by law cannot be its owner, that person must, within 6 months of accepting the inheritance, transfer the I\u012e to another natural person, reorganise it, convert it or liquidate it (Article 10(2) I\u012e\u012e). If the heir already owns another I\u012e, the heir's I\u012es can be merged (Article 12(2) I\u012e\u012e).<\/p>\r\n<p>If the owner loses legal capacity, in full or in part, the court appoints an administrator of the I\u012e's assets, who acquires the owner's rights and duties (Article 6(7) I\u012e\u012e). That administrator then exercises the owner's rights, including the decision to liquidate.<\/p>\r\n<h2>How the I\u012e is deregistered<\/h2>\r\n<p>After the settlements, the liquidator files the liquidation certificate and the other deregistration documents with the register (Article 13(4)(8) I\u012e\u012e). Point 198 of the Regulations of the Register of Legal Entities (the JAR Regulations) lists what must be filed: an application for deregistration, the liquidation certificate, a certificate that the documents were handed over for safekeeping, and other documents.<\/p>\r\n<p>The liquidator must complete the liquidation and deregister the I\u012e no later than one year after the status of an entity in liquidation is registered. Before that period ends, the registrar can be asked to extend it by one year (Article 2.110(3) CK). What drives the timing is covered in <a href=\"https:\/\/linden.lt\/en\/blog\/how-long-company-liquidation-really-takes\/\">How long company liquidation takes<\/a>.<\/p>\r\n<p>The I\u012e ceases to exist from its deregistration from the register of legal entities (Article 2.95(3) CK).<\/p>\r\n<h2>More on liquidation<\/h2>\r\n<ul><li><a href=\"https:\/\/linden.lt\/en\/services\/company-law\/liquidation-of-companies\/\">Liquidation of companies: service page<\/a><\/li><li><a href=\"https:\/\/linden.lt\/en\/services\/company-law\/liquidation-initiated-by-the-centre-of-registers\/\">Liquidation initiated by the Centre of Registers<\/a><\/li><li><a href=\"https:\/\/linden.lt\/en\/blog\/liquidating-a-public-institution-vsi-lithuania\/\">Liquidating a public institution (V\u0161\u012e): who decides, liquidator, assets<\/a><\/li><li><a href=\"https:\/\/linden.lt\/en\/blog\/liquidating-an-association-or-charity-fund-lithuania\/\">Liquidating an association or charity fund: who gets the assets<\/a><\/li><li><a href=\"https:\/\/linden.lt\/en\/blog\/closing-foreign-company-branch-lithuania\/\">Closing a foreign company\u2019s branch in Lithuania: steps and what can stop it<\/a><\/li><li><a href=\"https:\/\/linden.lt\/en\/blog\/liability-after-company-deregistration-shareholders-ceo-lithuania\/\">Are shareholders and the CEO liable for debts after deregistration?<\/a><\/li><li><a href=\"https:\/\/linden.lt\/en\/blog\/assets-left-after-company-deregistration\/\">The company has been deregistered but money is left in its account \u2013 what can be done<\/a><\/li><li><a href=\"https:\/\/linden.lt\/en\/blog\/liquidating-a-uab-remotely-foreign-shareholder-lithuania\/\">Liquidating a UAB with a shareholder abroad: what can be done remotely<\/a><\/li><li><a href=\"https:\/\/linden.lt\/en\/blog\/liquidation-archive-and-state-land-lease-certificate-lithuania\/\">Liquidation in Lithuania: archive certificate and state land lease tax<\/a><\/li><li><a href=\"https:\/\/linden.lt\/en\/blog\/annual-financial-statements-during-liquidation-lithuania\/\">Liquidation in Lithuania: annual financial statements and the AGM<\/a><\/li><li><a href=\"https:\/\/linden.lt\/en\/blog\/shares-held-by-a-company-in-liquidation-lithuania\/\">Shares in other companies during liquidation: act before deregistration<\/a><\/li><li><a href=\"https:\/\/linden.lt\/en\/blog\/after-bankruptcy-opens-duties-of-ceo-and-shareholders-lithuania\/\">After bankruptcy opens: CEO duties and what shareholders can still do<\/a><\/li><\/ul>\r\n<h2>How to start<\/h2>\r\n<p>Send us the I\u012e's articles (<em>nuostatai<\/em>) and a recent Centre of Registers extract, and tell us what debts, assets, contracts and employees the I\u012e has. If the owner has died, tell us who accepted the inheritance and when. We will assess whether to liquidate or convert, and who has to take the decision.<\/p>\r\n<p>Phone +370 5 212 1506, email info@linden.lt<\/p>\r\n<p>More about this service: <a href=\"https:\/\/linden.lt\/en\/services\/company-law\/liquidation-of-companies\/\">Liquidation of companies<\/a>.<\/p>"}]},"_links":{"self":[{"href":"https:\/\/linden.lt\/en\/wp-json\/wp\/v2\/irasas\/2275","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/linden.lt\/en\/wp-json\/wp\/v2\/irasas"}],"about":[{"href":"https:\/\/linden.lt\/en\/wp-json\/wp\/v2\/types\/irasas"}],"version-history":[{"count":1,"href":"https:\/\/linden.lt\/en\/wp-json\/wp\/v2\/irasas\/2275\/revisions"}],"predecessor-version":[{"id":2309,"href":"https:\/\/linden.lt\/en\/wp-json\/wp\/v2\/irasas\/2275\/revisions\/2309"}],"wp:attachment":[{"href":"https:\/\/linden.lt\/en\/wp-json\/wp\/v2\/media?parent=2275"}],"wp:term":[{"taxonomy":"kategorija","embeddable":true,"href":"https:\/\/linden.lt\/en\/wp-json\/wp\/v2\/kategorija?post=2275"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}