Moving money out of bank account before closing company

[UKSBD]

I am planning on closing a Limited company soon,

It hasn't traded in 5 months

It has no debts and about £2,000 in the bank

There will be zero Corporation tax to pay when accountant does accounts

Only transactions are £7.00 a month bank fees

Can I just withdaw all the money now so none is left in the bank account and close the bank account?

The money will still belong to the company and will be used to pay accountant for final accounts and help closing company

Basically just want to move all money to a holding account (shoe box under bed) so that I can close bank account, is that allowed?

 

[Joyous]

Basically just want to move all money to a holding account (shoe box under bed) so that I can close bank account, is that allowed?

Strictly speaking - no, but realistically (and if no one is owed) who is going to object? A company has to have three months complete inactivity before it can submit DS01. If you are still owing and paying your accountant you're stil active, even if not trading.

If you formally agree that the final accountant's fee will be borne by you personally then you can close the account and treat the money as a dividend or a distribution in the final accounts. The three month wait starts from that point and you just pay the accountant from the £2k (which is now yours) once done.

 

[UKSBD]

Strictly speaking - no, but realistically (and if no one is owed) who is going to object? A company has to have three months complete inactivity before it can submit DS01. If you are still owing and paying your accountant you're stil active, even if not trading.

If you formally agree that the final accountant's fee will be borne by you personally then you can close the account and treat the money as a dividend or a distribution in the final accounts. The three month wait starts from that point and you just pay the accountant from the £2k (which is now yours) once done.

If I take £2k out and pay the accountant personally with this, won't I have tp pay tax on it personally?

If the company pays the accountant 1st I assume I won't pay any personal tax?

If a company has to be completely inactive does that mean it has to close the bank account down 3 months befoe submitting the DS01?

What happens if an unexpected bill comes in during the 3 months, does the start of the 3 months start again?

 

[UKSBD]

If you are still owing and paying your accountant you're stil active, even if not trading.

Just to add, the company doesn't actually owe the accontantant anything, but will do when he files annual accounts, can the company pay this in advance?

 

[Joyous]

Just to add, the company doesn't actually owe the accontantant anything, but will do when he files annual accounts

So the company still has future liabilities of which you, the director, are aware. If the future liability shifts to you, the three month clock can start. Otherwise it starts after you've paid your accountant.

 

[UKSBD]

So the company still has future liabilities of which you, the director, are aware. If the future liability shifts to you, the three month clock can start. Otherwise it starts after you've paid your accountant.

So if I have to close the bank account 3 months before company can start the dissolving process I'm back to my original question.

Where can the money be kept between the day I close bank account and the day dissolving starts?

Can the company just take it out of bank and have a cash deposit somewhere?

In effect It will still belongs to the company, but the company will no longer has a bank acount to keep it in

 

[WaveJumper]

All that possible hassle to save what £21.00 ?

 

[UKSBD]

All that possible hassle to save what £21.00 ?

Dont the bank transactions count as activity then?

It's more the case of whether any unexpected bills get taken from the account if it is still set up and thus start the 3 months again

 

[Newchodge]

Strictly speaking - no, but realistically (and if no one is owed) who is going to object? A company has to have three months complete inactivity before it can submit DS01. If you are still owing and paying your accountant you're stil active, even if not trading.

If you formally agree that the final accountant's fee will be borne by you personally then you can close the account and treat the money as a dividend or a distribution in the final accounts. The three month wait starts from that point and you just pay the accountant from the £2k (which is now yours) once done.

I wasn't aware of any regulation that a limited company must have a bank account at all times. If the money is withdrawn and credited to petty cash, then that cash used to pay ths final bill, what is the problem?

 

[Joyous]

I wasn't aware of any regulation that a limited company must have a bank account at all times. If the money is withdrawn and credited to petty cash, then that cash used to pay ths final bill, what is the problem?

True - but £2000 cash in a shoe box under the bed?

 

[UKSBD]

I wasn't aware of any regulation that a limited company must have a bank account at all times. If the money is withdrawn and credited to petty cash, then that cash used to pay ths final bill, what is the problem?

I can't see any other way of doing it.

The Company needs the money to pay the final accountantcy fees, but if company isn't billed by accountant until he has finished what then happens to the accounts for the 3 months between paying the accountantant and waiting to dissolve?

Do you not have to file accounts for the period when compay stopped trading and when it is didssolved?

 

[UKSBD]

Is this basically what I have to do?

Tell accountant I want to stop trading

He does final accounts up to a set date and bills me on same day.

I pay him same day

the 3 months starts

Accountant doesn't have to do accounts for those 3 months

Extract any money left as a dividend on last day of the 3 months

Send in DS01

 

[Joyous]

The Company needs the money to pay the final accountantcy fees,

I sincerely doubt that the accountant will care whether payment comes from you or the company. Easiest thing is to take the money, close the account and pay accountant when the bill comes.

 

[UKSBD]

I sincerely doubt that the accountant will care whether payment comes from you or the company. Easiest thing is to take the money, close the account and pay accountant when the bill comes.

How do I account for just taking the money out of the business?

 

[Joyous]

How do I account for just taking the money out of the business?

Salary, dividend or capital distribution - your choice.

 

[UKSBD]

What final accounts have to be submitted?

Up to the date the company stops trading, the date the DS01 is sent in, the date dissolution is confirmed?

 

[UKSBD]

Just to clarify

My end of year is September

Accountant will do accounts for 2023 year end soon which will cost about £600

I assume he will then do end of year 2024 which would be on 30th Sept 2024

If I say I want to stop trading on 29/02/24, would the 2024 year be shortened and he only has to do accounts up until 29/2/2024

Were only looking at about £400 being left after accountant has been paid

 

[UKSBD]

Salary, dividend or capital distribution - your choice.

If I was to take £1500 as a salary and then personally pay the accountant £1500 would I (personally) get tax relief on the £1500

I'm trying to do things the correct way, but it sounds like I'm better off just taking all the money out, not filing anymore accounts so as not to have a bill from the accountant

 

[Joyous]

I am planning on closing a Limited company soon,

It hasn't traded in 5 months

Surely your accounts to September 2023 will cover everything. Why do a second set when nothing has happened? Speak to your accountant. They're the best people to advise you.

 

[UKSBD]

I deliberately haven't traded since September for this reason, but have had to pay some bills and bank fees.

From what you posted earlier this is classed as trading (or is there a difference between trading and bein active?)

Would I have to submit accounts for those few months when I haven't been actively trading but have had to pay bills?

It would be ideal if I accountant did year end 2023 accounts in next few weeks, I paid him and that was it. I then just close company

 

[Joyous]

Your accountant, with whom (presumably) your company has a history, is the best person to advise you.

 

[Lisa Thomas]

You might be confusing two different entities, obligations and taxes.

The Company should pay the accountant for any work in dealing with the company's affairs/tax returns/tax liabilities.

You will then need to account for the amount of drawings you take as income personally and might need an accountant to help you with your personal income declaration and any personal taxes thereon.

 

[Paul Kelly ICHYB]

Pay the accountant upfront/in advance for future services to close the business.

 

[UKSBD]

Update on this as accountant handling it now

He's just finished accounts for year end 2023 and says they will be the last ones required

He's then going to set about closing the business down.

Had a bit more money in there than I thought (about £5k) but he says we can just withdaw all this (after paying his last fees 1st) as capital distribution (or something like that) with no tax to pay on it

 

[WaveJumper]

Update on this as accountant handling it now

He's just finished accounts for year end 2023 and says they will be the last ones required

He's then going to set about closing the business down.

Had a bit more money in there than I thought (about £5k) but he says we can just withdaw all this (after paying his last fees 1st) as capital distribution (or something like that) with no tax to pay on it

Lets hope after taking his fees its not left in the red ? great result though a lot off your plate I would imagine

 

[UKSBD]

Lets hope after taking his fees its not left in the red ? great result though a lot off your plate I would imagine

He's very good with us - only charged £600 a year for doing the anual accounts.

I have another business too which he also does accounts for, and only charges £900 for that one.

My bookkeeping is absolutely spot on though

 

[Jobby]

Accountant will do accounts for 2023 year end soon which will cost about £600

I print out P&L, balance sheet and Trial balance from my account’s software, email it to my account who files the accounts. £75.00