Filing Dormant Company Accounts

A dormant company is one that has had no significant accounting transactions during the financial year. Many people set up companies and then do not trade immediately, or they keep a company registered to protect the name. Either way, dormant companies still have filing obligations.

Failing to file accounts on time – even for a dormant company – results in automatic penalties from Companies House. This guide covers exactly what you need to do.

What counts as dormant?

Companies House and HMRC have slightly different definitions of dormancy:

A company can be dormant for Companies House purposes even if it has a bank account, as long as the account has had no transactions. The key test is whether any significant accounting transactions have occurred.

Transactions that do NOT break dormancy

• Payment of the Companies House annual filing fee
• Payment for shares when the company was first incorporated
• Late filing penalties charged by Companies House

Transactions that DO break dormancy

• Receiving any income (even interest on a bank balance)
• Paying any business expenses
• Buying or selling assets
• Making or receiving a loan
• Paying dividends

If any of these happen during the year, the company is no longer dormant and must file full accounts.

Filing dormant accounts at Companies House

Dormant company accounts are much simpler than full accounts. You file a balance sheet only – no profit and loss account, no director’s report, no notes.

What the balance sheet contains

For most dormant companies, the balance sheet shows:

If the company has never traded, this is usually all there is. The balance sheet must include:

• The company name and registration number
• The period the accounts cover
• A statement that the company was dormant throughout the period
• A statement that the company is entitled to exemption under Section 480 of the Companies Act 2006
• The signature of a director and the date

Filing online

You can file dormant accounts directly on the Companies House website using their WebFiling service. The process takes about 10 minutes:

1. Log in to WebFiling
2. Select your company
3. Choose “File dormant accounts”
4. Confirm the accounting period
5. Enter the balance sheet figures
6. Review and submit

There is no filing fee for dormant accounts submitted online.

Filing deadline

The standard deadline applies: 9 months after the end of the accounting period (21 months after incorporation for the first set of accounts). Missing this deadline triggers automatic penalties:

These penalties apply regardless of whether the company is dormant or trading. Companies House does not waive them because the company has no income.

Notifying HMRC

When your company becomes dormant, notify HMRC separately. You can do this by:

• Writing to HMRC’s Corporation Tax office
• Calling HMRC on 0300 200 3410
• Filing a final CT600 return and stating the company is now dormant

Once HMRC accepts that your company is dormant, they will stop issuing notices to file a Corporation Tax return. This means you will not need to file CT600 returns each year while the company remains dormant.

If HMRC has not been notified and they issue a notice to file, you must file the CT600 even if the company is dormant. Missing the filing deadline for a CT600 notice results in automatic penalties from HMRC (separate from the Companies House penalties).

Confirmation statement

A dormant company must still file a confirmation statement (formerly the annual return) at Companies House every year. This confirms that the company’s registered details are up to date.

The confirmation statement costs £13 when filed online and is due at least once every 12 months from the date of incorporation (or the date of the last statement).

Failing to file a confirmation statement can lead to Companies House starting the process to strike off your company from the register.

Keeping the company alive

To keep a dormant company on the register, you need to file:

The total annual cost of maintaining a dormant company is just £13, making it an inexpensive way to protect a company name or keep a company available for future use.

Reactivating a dormant company

When you are ready to start trading, you need to:

1. Notify HMRC that the company is now active and register for Corporation Tax
2. Open a business bank account (if you do not already have one)
3. Register for PAYE if you will be paying yourself or employees a salary
4. Register for VAT if your turnover will exceed £90,000, or voluntarily if it makes commercial sense

The company’s next set of accounts will be full trading accounts rather than dormant accounts.

When Companies House may strike off your company

If you fail to file accounts or a confirmation statement, Companies House can start compulsory strike-off proceedings. They will:

1. Send a letter to the company’s registered office warning of the proposed strike-off
2. Publish a notice in the Gazette
3. If no objection is received within two months, strike the company off the register

Once struck off, the company ceases to exist and any assets (including the company name) become the property of the Crown (a process called bona vacantia). You can apply to have the company restored, but this involves court proceedings and costs several hundred pounds.

Filing your dormant accounts on time avoids this entirely.

Common mistakes

• Assuming dormant means no filing required – accounts and confirmation statements are still due on time
• Not notifying HMRC – if they do not know the company is dormant, they will issue Corporation Tax notices and expect CT600 returns (penalties start at £100)
• Bank account activity that breaks dormancy – even receiving a few pence of interest technically makes the company non-dormant for that period
• Forgetting about the company entirely – directors sometimes incorporate, never trade and forget; years later they discover thousands in accumulated penalties