Where to Start on Closing a Company

Before you close the Company

You must meet the following conditions:

• The company must not have traded in the last 3 months nor changed its name

• You must have informed HMRC  – they will expect final accounts to close of trade and for any taxes to be settled.

• You’ll also need to account for any surplus funds that you intend to extract from the company by way of salary, dividend or capital distribution. If you’re not sure then you may need to speak with an accountant to help you through this process and ensure that you’ve extracted the funds correctly and in the most tax efficient way (get in touch to find out more – contact us)

• If you have any creditors then these must be told prior to the application and a copy of the strike off form must be sent to them within 7 days of it being filed

Complete the form hardcopy

The application to close or strike off the company must be made by the directors by completing a form called a DS01. The form is easy to complete and quite self explanatory in its content.

A paper version of the form can be downloaded from the GOV.uk web site – click here

The fee payable for this is £10.

Complete the form online

You can complete the form online – click here

The fee payable for this is £8; being easier and cheaper than hardcopy.

Protect your money

Be careful, the Crown will take possession of any money left in a business bank account if not withdrawn before you close the Company.

How long does it take?

Companies House say closing the Company takes approximately two months from your application. During this time, Companies House will:

• register the application for strike off on the company’s public record

• send an acknowledgement to both you and the company at its registered office address

• publish a notice in the Gazette for the strike off to allow anyone to object with a valid reason. HMRC may typically refuse to close the company should there be outstanding filing obligations or tax liabilities.

High value Company closures

Should there be a substantial amount of funds in the Company, you need to consider the most tax efficient way of extracting them. Should the funds be over £25,000, you may need to consider a Members Voluntary Liquidation.

Our effective tax planning, supported by our team of Chartered Accountants and Chartered Tax Advisors, would consider all distribution options including both income (dividends, salary, pension contributions etc.) and capital distributions and explore all specific tax reliefs that can be claimed such as Business Asset Disposal Relief (BADR) (get in touch to find out more – contact us)