1. Shareholders' resolution: Before cancellation, the company shall convene a shareholders' meeting or a shareholders' representative meeting, and the shareholders shall adopt a resolution to determine the handling method of undistributed profits. The resolution needs to comply with the shareholders' decision-making procedures and proportion requirements stipulated in the Company Law.

2. Distribution to shareholders: Undistributed profits can be distributed according to the shareholding ratio of shareholders. Companies can return profits to shareholders in cash or by paying dividends. This requires the company to formulate the corresponding distribution plan according to the actual situation and get the consent of shareholders.

3. Use for specific purposes: According to the resolution of shareholders, the company can use undistributed profits for specific purposes. This may include the establishment of reserve funds, investment or capital expansion, charitable donations, etc. The company needs to have a clear purpose and formulate detailed management measures.

If a company meets one of the following conditions, it may apply for cancellation:

1, the company was declared bankrupt according to law;

2. The business term stipulated in the Articles of Association expires or other reasons for dissolution occur;

3. The company is dissolved due to merger or division;

The company was ordered to close down according to law.

To sum up: when the company cancels, if the undistributed profit still has a balance, because the undistributed profit belongs to the after-tax profit of the enterprise and not to the personal income, when it has to be redistributed to the shareholders, it should still have dividend income and pay personal income tax. Shareholders of a limited liability company shall be liable to the company to the extent of their subscribed capital contribution; Shareholders of a joint stock limited company shall be liable to the company to the extent of the shares subscribed by them.

Legal basis:

People's Republic of China (PRC) partnership enterprise law

Article 90

After the liquidation, the liquidator shall prepare a liquidation report, which shall be signed and sealed by all partners, and submitted to the enterprise registration authority within 15 days to apply for cancellation of the registration of the partnership enterprise.