{"id":1967,"date":"2019-05-15T08:31:22","date_gmt":"2019-05-15T09:31:22","guid":{"rendered":"http:\/\/www.cheapaccounting.co.uk\/blog\/?p=1967"},"modified":"2026-01-08T07:50:21","modified_gmt":"2026-01-08T08:50:21","slug":"what-exactly-is-a-dormant-company","status":"publish","type":"post","link":"https:\/\/www.cheapaccounting.co.uk\/blog\/index.php\/what-exactly-is-a-dormant-company\/","title":{"rendered":"What is a dormant company?"},"content":{"rendered":"

I regularly see the term dormant company<\/strong><\/span> used incorrectly.<\/p>\n

Things like:<\/p>\n

\u201cCan I declare my company dormant?\u201d<\/em><\/span><\/p>\n

\u201cI have a few transactions but want to file dormant accounts\u201d<\/em><\/span><\/p>\n

Unfortunately the term \u201cdormant\u201d is often misused and perhaps misunderstood.<\/p>\n

So what is a dormant company?<\/strong><\/span><\/h4>\n

The definition of importance is the Companies House one:<\/p>\n

A company is dormant if it has had no ‘significant accounting transactions’ during the accounting period. A significant accounting transaction is one which the company should enter in its accounting records.<\/em><\/strong><\/p>\n

When determining whether a company is dormant you can disregard the following transactions:<\/p>\n

    \n
  • payment for shares;<\/li>\n
  • fees paid to the Registrar of Companies for a change of company name, the re-registration of a company and filing the Confirmation Statement; and<\/li>\n
  • payment of a penalty for late filing of accounts.<\/li>\n<\/ul>\n

    So there must be no significant transactions for the WHOLE<\/strong><\/span> of the accounting period.<\/p>\n

    This means that a company is not dormant if for example:<\/p>\n

      \n
    • There is interest received on the company bank account<\/li>\n<\/ul>\n
        \n
      • Accounting fees are paid<\/li>\n<\/ul>\n
          \n
        • A web site, hosting and url are paid for<\/li>\n
        • Bank Charges are incurred<\/li>\n<\/ul>\n
            \n
          • etc<\/li>\n<\/ul>\n

            Any such transactions will mean that the company has to file accounts and corporation tax returns in the normal way.<\/p>\n

            Can I declare my company to be dormant?<\/strong><\/span><\/h4>\n

            There is no formal process to declare a company as dormant. In fact you still have filing duties to adhere to even if the company is dormant.<\/p>\n

            For example you must file dormant accounts at Companies House by the due date and file the Confirmation Statement each year.<\/p>\n

            In addition you must inform HMRC that the company is dormant so that it does not expect a corporation tax return to be filed.<\/p>\n

            Failure to file can result in fines and \/ or the company being struck off!<\/p>\n

            Can I set up a dormant company to protect a business name?<\/strong><\/span><\/h4>\n

            Yes and this is quite a common practice.<\/p>\n

            A company can be registered at Companies House even if there is no immediate intention for that company to trade.<\/p>\n

            However, once again the company must file dormant accounts, a Confirmation Statement and let HMRC know that it is dormant and a corporation tax return will not be due.<\/p>\n

             <\/p>\n","protected":false},"excerpt":{"rendered":"

            I regularly see the term dormant company used incorrectly. Things like: \u201cCan I declare my company dormant?\u201d \u201cI have a few transactions but want to file dormant accounts\u201d Unfortunately the term \u201cdormant\u201d is often misused…<\/p>\n","protected":false},"author":1,"featured_media":13400,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[1067,1033,1060],"tags":[31,30,197,15,28],"class_list":["post-1967","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-to-review","category-1-about-accounts-and-tax","category-review-and-update","tag-business","tag-cheapaccounting-co-uk","tag-dormant-company","tag-limited-company","tag-small-business"],"_links":{"self":[{"href":"https:\/\/www.cheapaccounting.co.uk\/blog\/index.php\/wp-json\/wp\/v2\/posts\/1967","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.cheapaccounting.co.uk\/blog\/index.php\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.cheapaccounting.co.uk\/blog\/index.php\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.cheapaccounting.co.uk\/blog\/index.php\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/www.cheapaccounting.co.uk\/blog\/index.php\/wp-json\/wp\/v2\/comments?post=1967"}],"version-history":[{"count":15,"href":"https:\/\/www.cheapaccounting.co.uk\/blog\/index.php\/wp-json\/wp\/v2\/posts\/1967\/revisions"}],"predecessor-version":[{"id":12979,"href":"https:\/\/www.cheapaccounting.co.uk\/blog\/index.php\/wp-json\/wp\/v2\/posts\/1967\/revisions\/12979"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.cheapaccounting.co.uk\/blog\/index.php\/wp-json\/wp\/v2\/media\/13400"}],"wp:attachment":[{"href":"https:\/\/www.cheapaccounting.co.uk\/blog\/index.php\/wp-json\/wp\/v2\/media?parent=1967"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.cheapaccounting.co.uk\/blog\/index.php\/wp-json\/wp\/v2\/categories?post=1967"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.cheapaccounting.co.uk\/blog\/index.php\/wp-json\/wp\/v2\/tags?post=1967"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}