Dormant accounts and paying for unpaid shares

[spb888]

Hello

Please can you confirm if a company is dormant with unpaid shares and a payment for the shares is made, would the dormant status be changed?

Also would there be a need to show the unpaid shares on the dormant accounts and if so, where would it be shown? For example:

Current assets
1 - Cash at bank and in hand
1 - Debtor
2 - Net assets
Issued share capital
1 - One Ordinary Share of £1 each
1 - Total Shareholder funds
*1 - unpaid share*??

Thanks in advance for your help, it is much appreciated.

Many thanks
Sharon

 

[Chris Ashdown]

A company is dormant because it is not trading, paying for a share is not trading so no change, also no real reason to pay for the share whilst it is dormant

 

[Scalloway]

This form shows where Unpaid Shares sit on a dormant company accounts. In technical terms it is a debtor of the company.

https://assets.publishing.service.g...ads/attachment_data/file/933649/AA02_V5.0.pdf

You can file the accounts online.

https://www.gov.uk/government/publications/file-your-dormant-accounts-aa02

 

[spb888]

A company is dormant because it is not trading, paying for a share is not trading so no change, also no real reason to pay for the share whilst it is dormant

Thanks for your reply Chris, much appreciated. I just thought it would be more simplified and tidy to have them all paid for, but ok with leaving things as-is.

Many thanks
Sharon

 

[spb888]

This form shows where Unpaid Shares sit on a dormant company accounts. In technical terms it is a debtor of the company.

https://assets.publishing.service.g...ads/attachment_data/file/933649/AA02_V5.0.pdf

You can file the accounts online.

https://www.gov.uk/government/publications/file-your-dormant-accounts-aa02

Thanks also for your reply Scalloway, as well as including the extra link for filing the accounts, much appreciated. Unfortunately, the form is for companies that haven't traded, which is not the case with this company, which has traded.

So do I still need to show the unpaid share and how would it balance from the example given on my initial post?

Many thanks
Sharon

 

[Scalloway]

From memory shares that are unpaid are the first item on a Balance Sheet, above fixed assets. There is always a separate heading for them.

The opposite entry is Share Capital in the liabilities side.

 

[UK Contractor Accountant]

Please can you confirm if a company is dormant with unpaid shares and a payment for the shares is made, would the dormant status be changed?

Dormant status means different things depending on circumstances.

Chris's definition above is for Corporation Tax purposes. Companies House have a stricter definition.

Dormant company definition for Companies House purposes
Companies House employ a more rigorous dormant company definition. They define a dormant company as one that has had no significant accounting transactions during the accounting period. A ‘significant’ accounting transaction is defined as one that the company should enter in its accounting records. Provided no such transactions occur during the financial period then the company can have dormant company status.

 

[spb888]

From memory shares that are unpaid are the first item on a Balance Sheet, above fixed assets. There is always a separate heading for them.

The opposite entry is Share Capital in the liabilities side.

Thanks Scalloway for making that clear, much appreciated.

Many thanks
Sharon

 

[spb888]

Dormant status means different things depending on circumstances.

Chris's definition above is for Corporation Tax purposes. Companies House have a stricter definition.

Dormant company definition for Companies House purposes
Companies House employ a more rigorous dormant company definition. They define a dormant company as one that has had no significant accounting transactions during the accounting period. A ‘significant’ accounting transaction is defined as one that the company should enter in its accounting records. Provided no such transactions occur during the financial period then the company can have dormant company status.

Thank you UK Contractor Accountant for the definition of a dormant company for Companies House. The company has not made any transactions during the accounting period.

Many thanks
Sharon

 

[CandC]

A company is dormant because it is not trading, paying for a share is not trading so no change, also no real reason to pay for the share whilst it is dormant

As others have pointed out, it seems that the Companies House and HMRC definitions are different.