A dormant company is 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, then the company can have a dormant company status. Companies House has defined only the following few, very specific transactions that the company may put through their records and still submit dormant accounts:
- Payment for shares by the subscribers to the memorandum of association.
- Fees paid to Companies House
- Payment of a civil penalty for late filing of accounts
If the company has any other transactions during the year, it will lose the dormant status.
Transactions like bank charges, earning interest on a bank account, Buying and selling, or paying for any other will cause a company to lose dormant status since this too will be considered a significant accounting transaction.
