Dormant companies and associations
Dormant for Corporation Tax
Your company is usually dormant for Corporation Tax if it:
- has stopped trading and has no other income, for example investments
- is a new limited company that hasn鈥檛 started trading
- is an unincorporated association or club owing less than 拢100 Corporation Tax
- is a flat management company
Trading includes buying, selling, renting property, advertising, employing someone or getting interest. HMRC has detailed guidance on what counts as dormant for Corporation Tax.
When HMRC thinks your company is dormant
You may get a letter from HMRC telling you:
- they鈥檝e decided to treat your company or association as dormant
- that you don鈥檛 have to pay Corporation Tax or file Company Tax Returns
When you think your company is dormant
If your company has stopped trading and has no other income, you can tell HMRC that it鈥檚 dormant for Corporation Tax.
If you鈥檝e filed a Company Tax Return or had a 鈥榥otice to deliver a Company Tax Return鈥�
You鈥檒l still need to file a Company Tax Return online - this will show HMRC that your company is dormant for this period.
Limited companies
You don鈥檛 need to pay Corporation Tax or file another Company Tax Return once you鈥檝e told HMRC your company is dormant unless you receive a further notice to deliver a Company Tax Return.
You must still file annual accounts and a confirmation statement (previously annual return) - exactly what you must do depends on if you鈥檙e dormant for Companies House.
Find out how to restart your company.
If you鈥檙e registered for VAT
If you do not intend to trade again you must deregister for VAT within 30 days of your company becoming dormant.
However, if you plan to restart trading, you must send 鈥榥il鈥� (empty) VAT returns while your company is dormant.
If you employ people
If you do not plan to restart trading in this tax year, you should close your PAYE scheme.