If your UK limited company has never traded or has stopped operating, you may still need to file annual accounts with Companies House. If you are researching how to file dormant accounts companies house, it is important to understand that dormant accounts are simpler than accounts for a trading business, but they still have to be prepared and filed correctly. Companies House confirms that all limited companies must deliver annual accounts, whether they are trading or dormant.
For businesses that need help keeping their records organised, Top Bookkeeping Services can help make bookkeeping and statutory accounting requirements easier to manage.
What Are Dormant Company Accounts
Dormant company accounts are accounts filed by a company that has had no significant accounting transactions during its financial year. For Companies House purposes, significant transactions are generally those that the company should enter into its accounting records.
Certain transactions can be disregarded when determining whether a company is dormant. These include Companies House filing fees, late filing penalties and money paid for shares when the company was incorporated.
Being dormant for Companies House is also different from being dormant for Corporation Tax. A company can be dormant for tax purposes while still having Companies House filing obligations.
What Information Do Dormant Accounts Include
Dormant accounts are generally much simpler than accounts for an active trading company. Companies House states that dormant accounts filed with it do not need to include a profit and loss account or directors’ report.
The accounts normally include a balance sheet, comparative figures from the previous year and relevant notes. The balance sheet must contain the required statements confirming the company’s dormant status and, where applicable, its audit exemption.
How to File Dormant Accounts with Companies House
If you are looking for how to file dormant accounts companies house, follow these steps:
Step 1: Check Whether Your Company Is Dormant
Check your company’s accounting records first. A company is generally dormant if it has had no significant accounting transactions during the financial year. Certain transactions, such as Companies House filing fees and incorporation share payments, may be disregarded.
If the company has received customer payments or paid normal business expenses, check its status before filing dormant accounts.
Step 2: Check Your Filing Deadline
Dormant companies have the same accounts filing deadlines as other companies. Check your accounting reference date and previous filing history to avoid late filing penalties.
Step 3: Get Your Authentication Code
You need the company’s Companies House authentication code to file accounts online. Keep it secure because it provides access to the company’s online filing services.
Step 4: Open the Companies House Filing Service
Sign in to the Companies House online filing service and select the relevant company. Eligible companies that have not previously traded can use the online dormant accounts filing route.
Step 5: Select the Dormant Accounts Option
Choose the accounts section and select the dormant accounts option if your company is eligible. The online service includes checks to help identify missing information and common errors.
Step 6: Check Company Details
Review the information displayed and make sure it matches the Companies House register, including:
- Company name and number
- Accounting period
- Balance sheet date
- Previous accounts information
Step 7: Enter Balance Sheet Information
Dormant accounts generally focus on the balance sheet rather than a full profit and loss account. If using the AA02 form, enter relevant figures such as share capital, cash at bank, net assets and shareholders’ funds.
Use your actual accounting records rather than entering zero simply because the company is dormant.
Step 8: Complete Required Statements
Include the required audit exemption and directors’ statements. Read each declaration carefully before confirming the filing.
Step 9: Review the Filing
Check the information before submitting, particularly:
- Balance sheet date
- Share capital and cash balances
- Net assets
- Comparative figures
- Audit exemption statements
- Director details and declarations
Incomplete or incorrect dormant accounts may be returned.
Step 10: Submit the Accounts
Submit the accounts through the Companies House filing service and save the confirmation or submission reference. You can then check the company’s filing history to confirm that the dormant accounts have been recorded.
Can You Use the AA02 Form for Dormant Accounts
The AA02 is specifically called the “Dormant company accounts” form. Companies House provides it for eligible dormant companies.
However, the AA02 is not suitable for every dormant company.
Companies House states that if a company is dormant and has not traded since incorporation, it can file a paper AA02. The form is also available as part of the online filing process for eligible companies.
The paper AA02 should not be used for a dormant company that became dormant after previously trading. Dormant subsidiary companies may also have different requirements and cannot use the AA02 where the form does not contain the necessary information.
What Are the Dormant Company Rules UK Businesses Should Know
The dormant company rules UK businesses need to follow mainly concern filing obligations and the definition of significant accounting transactions.
A dormant company still has to file annual accounts and a confirmation statement with Companies House. Dormant status does not remove these obligations.
The dormant company rules UK companies follow also mean that certain transactions can be ignored when determining dormant status. Companies House specifically lists incorporation share payments, certain Companies House fees and late filing penalties as transactions that can be disregarded.
Businesses should also remember that the dormant company rules UK and HMRC’s rules for Corporation Tax are not identical.
Dormant Accounts vs Corporation Tax Dormancy
A common mistake is assuming that being dormant for Corporation Tax automatically means there is nothing to file with Companies House.
Companies House clearly states that a limited company must file its confirmation statement and annual accounts even if it is dormant for Corporation Tax or dormant according to Companies House.
If the company is also dormant for Corporation Tax purposes, check its HMRC obligations separately.
What Happens If a Dormant Company Starts Trading
A company can stop being dormant when it begins commercial or trading activities or has significant accounting transactions that need to be recorded.
You do not normally need to separately notify Companies House that the company has restarted trading. Companies House says that the next set of non-dormant accounts will show that the company is no longer dormant.
Once trading starts, maintain complete accounting records from that point so the appropriate accounts can be prepared.
Common Mistakes to Avoid
When preparing dormant company accounts, avoid these common mistakes:
- Assuming a dormant company does not need to file accounts
- Confusing Companies House dormancy with Corporation Tax dormancy
- Using AA02 after the company has previously traded
- Entering incorrect share capital information
- Using the wrong balance sheet date
- Ignoring comparative figures
- Missing the accounts filing deadline
- Forgetting the confirmation statement
- Treating every company transaction as automatically irrelevant
Checking the company’s records before filing can help identify whether dormant accounts are actually appropriate.
Conclusion
Filing dormant company accounts is generally simpler than preparing accounts for an active business, but dormant status does not remove your Companies House obligations. If you understand how to file dormant accounts companies house, you can check whether the company meets the definition of dormant, confirm the filing deadline, use the correct filing route and carefully review the balance sheet information before submission.
For companies that have never traded, the AA02 may be suitable, but it should not be used automatically for every dormant company. Understanding the dormant company rules UK businesses must follow can help prevent incorrect filings and late penalties. Top Bookkeeping Services can help businesses keep their accounting records organised and manage routine bookkeeping requirements alongside statutory filing responsibilities.
Frequently Asked Questions
Do dormant companies have to file accounts with Companies House?
Yes. All limited companies must deliver annual accounts to Companies House, including companies that are dormant or not trading.
What is the AA02 form?
The AA02 is the Dormant company accounts form provided by Companies House for eligible dormant companies. It can be used by a company that is dormant and has not traded since incorporation, subject to the form’s requirements.
Can I file dormant accounts online?
Yes. Companies House provides online filing for dormant accounts, including WebFiling for eligible companies that have not previously traded.
Do dormant companies need a confirmation statement?
Yes. A dormant company still needs to file its confirmation statement with Companies House. Dormant status does not remove this requirement.
What happens if dormant accounts are filed late?
Dormant accounts have the same filing deadlines and late filing penalties as other company accounts.