You cannot use a certificate of dissolution to pay Delaware's annual fee
A certificate of dissolution ends your company's legal existence in Delaware. Once filed, your business is no longer active, which means you stop owing the annual fee going forward. However, if you owe the fee for years before dissolution, you must pay it separately — the dissolution certificate itself is not a payment method or a substitute for paying what you already owe.
Delaware's Division of Corporations will not accept a dissolution certificate as payment. The fee and the dissolution are two separate transactions. If you file for dissolution while owing back fees, the state may hold your dissolution request until you settle the debt, or it may process the dissolution and send you a bill afterward.
Key Takeaways
- A certificate of dissolution does not pay your annual fee — it only closes your company's registration with the state.
- If you owe Delaware's annual fee for prior years, you must pay it in cash or check before or after filing for dissolution.
- Delaware may delay processing your dissolution until you pay outstanding fees, or it may bill you after the fact.
- Contact the Delaware Division of Corporations directly to confirm what you owe before you file for dissolution.
- The annual fee is separate from dissolution fees, which are also paid in cash and not through the dissolution document itself.
What happens to your annual fee when you dissolve
When you file a certificate of dissolution, Delaware stops charging you the annual fee for future years. However, the state does not forgive fees you already owe. If your company was active for five years and you never paid the annual fee, you still owe five years' worth of payments.
The timing of when you pay matters. If you pay the fee before filing for dissolution, your record is clean and the dissolution process moves forward without delay. If you owe money when you file, the Division of Corporations may flag your account and either refuse to process the dissolution until you pay, or process it and bill you later.
How to check what you owe before dissolving
Contact the Delaware Division of Corporations directly at 302-739-3073 or visit their website to request an account statement. Tell them your company name and Delaware file number. They will tell you whether you have any outstanding annual fees, franchise taxes, or other debts to the state.
Getting this information before you file for dissolution prevents surprises. If you do owe money, you can pay it by check or money order made payable to "Delaware Department of Finance" and mail it to the Division of Corporations at 401 Federal Street, Suite 4, Dover, Delaware 19901. Include your company name and file number with the payment so the state can match it to your account.
The difference between annual fees and dissolution fees
Delaware charges two separate fees: the annual fee (also called the franchise tax), which you pay every year your company is active, and the dissolution fee, which is a one-time charge to file the certificate of dissolution itself. Both must be paid in cash — neither can be paid with a document.
The annual fee for most Delaware corporations is $300 per year, though it varies by company type and size. The dissolution fee is typically $25 to $100, depending on whether you file online or by mail and whether you need expedited processing. You pay the dissolution fee when you submit your dissolution paperwork, and you pay any outstanding annual fees separately before or after filing.
What to do if you cannot pay before dissolving
If you do not have the money to pay outstanding fees before filing for dissolution, contact the Division of Corporations and explain your situation. Some companies negotiate a payment plan, though this is not may provide. The state may also allow you to file the dissolution and then bill you for the debt afterward.
Do not assume the debt will disappear if you dissolve without paying. Delaware can pursue collection action against former business owners for unpaid state fees. It is better to contact the state, confirm what you owe, and work out a plan than to ignore the debt and risk legal action later.
Filing for dissolution and paying fees at the same time
When you file your certificate of dissolution with the Delaware Division of Corporations, you can include payment for the dissolution fee itself. However, you must handle any outstanding annual fees separately — either before you file or by contacting the state after dissolution is complete.
If you are filing online through the Division's website, you can pay the dissolution fee by credit card at the time of filing. If you are filing by mail, include a check for the dissolution fee with your paperwork. Again, this covers only the cost of filing the dissolution, not any annual fees you already owe.
Frequently Asked Questions
Will Delaware process my dissolution if I owe the annual fee?
It depends on the state's current procedures and your specific situation. Some applications are held until the fee is paid; others are processed and you are billed later. Call the Division of Corporations at 302-739-3073 to find out whether your account has a hold on it.
Can I pay Delaware fees online?
You can pay the dissolution fee online by credit card when you file through the Division's website. For outstanding annual fees, contact the Division directly — they will tell you whether online payment is available for your debt or whether you must mail a check.
What if I dissolve my company but never pay the annual fee?
Delaware can pursue collection action against you personally for unpaid state fees, even after the company is dissolved. The debt does not disappear when the company closes. It is better to pay what you owe or set up a payment plan than to ignore it.
Is the dissolution fee the same as the annual fee?
No. The annual fee is what you pay every year your company is active. The dissolution fee is a separate, one-time charge to file the certificate of dissolution. You may owe both, and they are paid separately.