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How To Make A Ltd Company Dormant

Discussion in 'Accounts & Finance' started by sirgeordie, Feb 5, 2008.

  1. sirgeordie

    sirgeordie UKBF Newcomer Free Member

    Posts: 1 Likes: 0
    Hey there - I've been reading this forum for a short while now and taking advantage of the free advice :cool: thanks a lot for the help so far, however I've decided to register and ask a question.

    I set up a limited company a few weeks ago, however haven't traded under that name yet. The company simply is the same name as I had when I was sole trading but with the Ltd on, however going limited was a bad idea for me. I've been reading other related posts, however can't seem to find the answer to the following question: how do I make my Ltd company dormant?

    I'm hoping it's just a simple matter of ceasing trading, however I'll be trading under the name without the Ltd on and was wondering if that will impact anything. Being honest, I simply liked the idea of it all - the money that is getting made isn't really worth forming a proper company for!

    Would I have to register as a sole trader once more? I know that a Ltd company is classed as an individual rather than being a part of me (as a director), so I was wondering what the legalities are.

    Thanks a lot!

    Posted: Feb 5, 2008 By: sirgeordie Member since: Feb 5, 2008
  2. PI Guy

    PI Guy UKBF Newcomer Free Member

    Posts: 2,499 Likes: 191
    Matters Leading up to dormant company status

    Preparing final trading accounts

    • Use the company’s usual accounting reference date.
    • Companies House expects accounts made up to the usual financial year end, regardless of the date that the company actually ceased trading within the year.
    Pay final Corporation Tax

    • File final trading accounts with the corporation tax inspector
    • Provide final corporation tax return (form CT600) with computation.
    • Following agreement and settlement of the final corporation tax assessment, advise the corporation tax inspector that the company is now dormant.
    Close payroll

    • Close the payroll scheme by notifying the Inspector that trading has now ceased and there are no employees.
    • The Inspector of Taxes dealing with the payroll affairs will then issue a final form P35 for the current tax year ended on the following 5 April. This form should be completed without delay and filed together with any associated P14’s, P11D, etc.
    Close bank accounts

    • All interest bearing bank accounts should be closed
    • It may be desirable to close any non interest bearing current accounts, in order to avoid bank correspondence/statements being issued.
    Terminate accountant services

    • Advise your company accountant and let any other professional acting for company know that any ongoing services/agreements are to be terminated while the company is dormant.
    Matters Arising During Dormant Company Period

    Companies House

    • Even though the company is dormant, an Annual Return must be filed at Companies House together with the £15 fee.
    • Complete a dormant Companies House form (DCA), made up to the usual accounting reference date.
    Registered Address

    • The company will need to maintain a registered office address, which can be either your home address or your accountant’s office address.
    • Companies House will need to be advised if there are any changes in the company director or secretary’s circumstances, by filing the appropriate change of director/secretary form (form 288C), which can be downloaded from the Companies House website.
    Cease Trading

    • It is important to ensure that the company does not undertake even a single trading transaction, including receipt of bank interest or revenue generating transaction.
    • Any such transactions occurring would require full trading accounts to be filed and the corporation tax return made to HMRC.
    Posted: Feb 5, 2008 By: PI Guy Member since: Jun 20, 2006
  3. Kent Accountant

    Kent Accountant UKBF Newcomer Free Member

    Posts: 1,998 Likes: 161
    Sorry Scott but this post is a little confusing :|

    Have you ceased trading as a self employed individual?

    Have you started trading as a limited company? If so, what have you actually done?

    SALINV's comments are more relevant if you have actually traded although there are a couple of inaccuracies, but from your OP it is not totally clear if the company has in fact commenced trading

    Posted: Feb 5, 2008 By: Kent Accountant Member since: May 30, 2006