How to File FREE Dormant Accounts for UK LTD

In this guide, we’ll walk you through what dormant accounts are, how to file them for free, and how to stay 100% compliant using tools like Taxd.

What is a Dormant Company?

A dormant company is a UK limited company that isn’t currently trading or generating income. It has had no ‘significant’ financial transactions during the financial year (aside from a few permitted ones like Companies House fees).

What are Dormant Accounts?

Dormant accounts are simplified financial statements filed by a company that hasn’t traded during the financial year. They typically include:

• A simplified balance sheet
• Optional notes to the accounts
• A declaration that the company was dormant

Benefits of Filing Dormant Accounts

Cost Reduction

It is usually easier to file dormant accounts than to file full accounts for an active business organization. No full accounting fees or corporation tax to pay.

Less Paperwork

Since dormant accounts are simpler to prepare, there will be less work to be done than when preparing and submitting consolidated accounts.

Use of Company

Keeping a dormant company helps you keep the company registered for future use.

How to File Dormant Accounts for UK LTD Companies

Filing dormant accounts for a UK limited company is relatively straightforward and free if you know where to do it. Here's a step-by-step guide to make the process simple and compliant.

Step 1: Confirm Your Company is Dormant

A company is considered dormant if it has had no significant financial transactions during the accounting period. This means:

• No trading activity
• No income or expenses (other than specific allowed transactions like Companies House fees)

If your company has received or spent money (other than for permitted reasons), it may not qualify as dormant.

Step 2: Prepare Your Dormant Accounts

Dormant accounts are simpler than standard company accounts but still require accurate preparation. At a minimum, you'll need:

• A balance sheet showing the company’s financial position at year-end
• A statement confirming the company has been dormant throughout the period

You can find free templates online or use an accounting service if needed. Keep in mind: accuracy matters, even for dormant companies.

Step 3: File with Companies House (Free)

You can file dormant accounts for free using the Companies House WebFiling service. This must be done:

• Within 9 months of your company’s financial year-end
• Online via your company’s WebFiling account

Important: This only covers Companies House. You still need to deal with HMRC separately

Step 4: Notify HMRC (Use Taxd for Simplicity)

Even if your company is dormant, HMRC may still expect a tax return. You must:

• Inform HMRC that your company is dormant
• File a zero tax return if requested

This part isn’t covered by Companies House.

Want to skip the HMRC headache?

Taxd’s Dormant Company Filing handles both the zero tax return and HMRC notifications – all for just £29.

Bottom Line

Filing dormant accounts with Companies House is free, but ignoring HMRC can be costly.

Stay fully compliant and avoid fines with Taxd’s Dormant Company Filing service. It’s simple, affordable (£29), and saves you from HMRC penalties.

FAQs

1. What is the difference between a dormant company and an active company?

A dormant company doesn’t carry out any business activity or earn income. It may only engage in certain limited actions, like paying a Companies House fee. An active company, on the other hand, is involved in trading, earning money, and paying expenses, which means it must file full accounts and pay taxes.

2. Can I file dormant accounts if my company has received or spent money during the financial year?

No. If your company has received income or made payments (except for permitted transactions like Companies House fees), it no longer qualifies as dormant. You must then file full statutory accounts and a corporation tax return. Filing dormant accounts in this case could lead to penalties.

3. How do I inform HMRC that my company is dormant?

You can notify HMRC by either:

• Filing a zero Corporation Tax return (CT600), or
• Writing to HMRC to let them know the company is dormant.

If HMRC accepts this, your company may be de-registered from Corporation Tax.

4. What happens if I file dormant accounts late?

There are strict penalties for late filing:

• £150 for being up to 1 month late
• Up to £1,500 if over 6 months late

Late filing can also damage your business reputation and may lead to your company being struck off the register.

Remember, HMRC and Companies House are separate and even if you file with one on time, you can still get fined by the other.