A dormant company is one that doesn’t trade and has no accounting transactions. Trading companies may also elect to become dormant if they cease trading and may wish to trade again in the future.
Reasons for Dormant Companies
1. Sometime you register a trader mark or have a Brand name you wish to protect, By registering a Dormant company you can secure that name and no one else will be able to use the same name.
2. By Securing a dormant Company name, you can be prepared in advance for future. Sometime you are not ready to start the project but you want to be prepared for the future. There is no time limit for keeping a company in a dormant status. However, the directors of dormant companies must still perform some administrative duties each year, as explained below:
Things to do – when you have a dormant Company.
- File Annual Return of the Company each year
- File dormant accounts every year to Companies house and inform HM Revenue & Customs.
- For Companies which have never traded, they can file their annual accounts via Form AA02 (PDF). Companies who traded in the past, but have become dormant may be able to use Form AA02 (DCA), but only if no transactions have been recorded in the current financial year and no residual balances exist.
- Company Must not generate any transaction during the year, Otherwise you will be laible to file full set of Accounts. Dormant companies may only have a few specific allowable transactions, but no accounting transactions.
The only allowed transactions of a dormant company are:
- payment for shares taken by subscribers to the memorandum of association;
- fees paid to the Registrar of Companies for a change of company name, the re-registration of a company and filing annual returns; and
- payment of a civil penalty for late filing of accounts.
Our Fee for Dormant Company.
We only charge £100 a year for dormant Accounts. please give us a call on 0800 6441 258 to find out more.