Closing down your company

f your company ceases to trade, you need to make a decision as to whether you are going to have the company struck off. You can also make your company dormant and we'll cover this at a later date. However, in the meantime this article provides details of what steps you need to take when closing down your company.

Closing down your company

Striking your company off means it will be removed from the register at Companies House and will no longer exist. If you decide to trade again at a future date after closing down your company, you will need to register a new company. However your old company name might not still be available.

Closing down your company - prerequisites

You can get your company struck off if:

  • Your company hasn’t traded or sold off any stock in the last 3 months (although we have had clients who have traded, have applied to have their company struck off and this has been allowed) – you can extend your company year end if applicable to meet this rule.
  • Hasn’t changed names in the last 3 months (this is not usually an issue for our clients).
  • Isn’t threatened with liquidation (again this is not normally a problem for our clients)
  • Has no agreements with creditors, e.g. a Company Voluntary Arrangement (CVA)

Strictly speaking, if your company doesn’t meet any of these criteria, then closing down your company is less straight-forward. In this instance, you will need to ‘liquidate’ your company.

Pre-strike off steps

The practical steps you will need to take when closing down your company and  before any final accounts are prepared are as follows:

  • You personally will need to buy back any assets from the company at their current market rate (e.g. any computers etc).
  • Close the company bank account (be aware you will need to send a cheque for £10 in order to get your company struck off – so this will probably need to be from a personal bank account).
  • PAYE – if the company is registered with a payroll scheme you will need to tell HM Revenue that the company has ceased its payroll scheme. This can be done via the company’s monthly RTI return.
  • VAT – if the company is registered for VAT you will need to de-register. This can be done via the company’s HM Revenue portal.

It may be more practical to extend the company’s year end so that you only have to file one final set of accounts. This may enable you to start the strike off process more quickly.

You can see more about changing your company year end in our previous post here.

You'll need to include a note in the accounts that the company has ceased trading and there is an application for the company to be struck off.

The strike off process

Once the company’s accounts have been filed with Companies House, and the corporation tax return has been filed and any tax paid, you can start the strike off procedure. You don’t have to file final accounts with Companies House although we generally suggest that this is done unless there is a compelling reason for not doing so.

You will also need to complete the form DS01 which you can complete online here. This will need to be sent to Companies House along with a £10 filing fee.

If, after submitting the DS01, you decide that you would prefer the company to be made dormant rather than being struck off, you will need to submit form DS02. This can be done online - see here.

Once the company has been struck off, you can no longer restore the company although you may be able to register a new company with the same name. 

For more useful information, check out our Ebooks here.

And if you'd like to know how we can help you with all of this, or with anything else, feel free to give us a call on 01202 048696 or email us at richard@tfaaccountants.co.uk.

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