Dormant Company Accounts: Everything You Need to Know in 2026

The term 'dormant' is used differently by HMRC and Companies House, which is one of the biggest sources of confusion for UK company directors. Understanding the distinction is essential because it determines exactly what you need to file, with whom, and when. Companies House definition: Under Section 1169 of the Companies Act 2006, a company is dormant if it has had no 'significant accounting transactions' during the accounting period. The legislation is precise about what counts: the only transactions that do not break dormancy are payment for shares taken by the initial subscribers to the memorandum of association, and fees paid directly to the Companies House Registrar. Everything else — bank interest, bank charges, insurance premiums, accountancy fees, domain renewals, or even a £1 refund from a supplier — is a significant accounting transaction that ends dormancy. HMRC definition: HMRC takes a broader, more activity-based view. A company is dormant for Corporation Tax purposes if it is not active — meaning it is not carrying on a business activity, not trading, not receiving any investment income, and has no chargeable gains. Crucially, HMRC may still consider a company dormant even if it has certain minor accounting transactions on its bank statement, provided those transactions are not business-related. For instance, if the only transaction on your company bank account in the year was a small amount of bank interest, HMRC might still treat the company as dormant for CT purposes — but Companies House would not. This dual definition creates real-world scenarios where directors must file with one body but not the other. For example, a company that received £2.30 in bank interest has a Corporation Tax obligation (even if the tax due is nil) and must file full accounts with Companies House, but the director may have assumed the company was dormant and filed nothing. It is exactly these grey areas that lead to unexpected penalties. The safest approach is to always check against both definitions before deciding how to file.

One of the most common misconceptions among UK company directors is that a dormant company has no filing obligations. In fact, the statutory requirements remain in place for as long as the company exists on the Companies House register — regardless of whether it has ever traded or generated a single penny of revenue. Companies House obligations: Every limited company registered in the UK must file annual accounts with Companies House without exception. For dormant companies, these are simplified 'dormant company accounts' (also known as AA02 accounts for companies that qualify under Section 480 of the Companies Act 2006). They are significantly shorter than full statutory accounts, but they are still a legal requirement. In addition, every company must deliver a confirmation statement (formerly the annual return) at least once every 12 months, confirming that the information Companies House holds — including registered office, directors, and share capital — is correct. The filing fee is currently £50 online. HMRC obligations: If HMRC considers your company active for Corporation Tax, you must file a CT600 return even if no tax is due. However, if you have formally notified HMRC that your company is dormant and they have acknowledged this, you typically will not need to file a CT600 until the company starts trading again. This is an important nuance — you need to actively tell HMRC that the company is dormant; they will not assume it automatically. If HMRC ever sends you a 'notice to deliver a Company Tax Return', you must comply regardless of dormancy status, and failure to do so attracts a penalty of at least £100, increasing to £500 for returns more than 3 months late. The penalties for late filing are real and escalate quickly. Companies House imposes automatic penalties with no discretion, no appeals process for simple lateness, and no warnings. The penalty structure for private limited companies is: — Up to 1 month late: £150 — 1 to 3 months late: £375 — 3 to 6 months late: £750 — More than 6 months late: £1,500 These penalties double if accounts are filed late in two consecutive years. For a company that is not generating any revenue, receiving a £1,500 penalty — or even £3,000 in consecutive years — is a harsh and entirely avoidable cost. On top of this, persistent late filing can trigger an investigation by Companies House and may lead to the director being deemed unfit to serve, potentially resulting in disqualification.

Many directors are unaware that you need to proactively notify HMRC that your company is dormant — it does not happen automatically when you stop trading. For newly incorporated companies: When you register a new limited company with Companies House, Companies House automatically notifies HMRC, and you will typically receive a letter (known as a CT41G) asking about the company's Corporation Tax status. If the company has never traded, you can indicate this on the CT41G form and HMRC will mark the company as dormant in their records. You will not be required to file CT600 returns until you notify HMRC that the company has become active. For companies that were previously trading: If your company has been trading and you have now ceased all business activity, you should file a final CT600 return covering the period up to the date trading ceased, and then contact HMRC to inform them the company is now dormant. You can do this by writing to your company's Corporation Tax office (the address will be on your previous correspondence) or by calling the HMRC Corporation Tax helpline. What happens after you notify HMRC: Once HMRC accepts that your company is dormant, they will stop issuing notices to deliver Corporation Tax returns. However, it is your responsibility to notify HMRC again if and when the company resumes trading — and you must do this within 3 months of becoming active. Failing to re-register for Corporation Tax on time can result in penalties and interest on any tax that becomes payable. Important: Even after telling HMRC your company is dormant, your Companies House filing obligations remain completely unchanged. You must still file annual dormant accounts and a confirmation statement every year.

Dormant accounts filed with Companies House are intentionally simple, but they must still follow the correct statutory format. Understanding exactly what is required — and what is not — helps you file with confidence. The balance sheet: This is the central component of dormant company accounts. It presents a snapshot of the company's financial position at the end of the accounting period. For a typical dormant company, the balance sheet is straightforward — it usually shows just one or two lines. The most common entry is share capital: if the company was formed with one ordinary share of £1, the balance sheet will show £1 in 'called up share capital' on the liabilities side and £1 in 'cash at bank and in hand' on the assets side (assuming the subscriber paid for their share). If the shareholder has not yet paid for the share, you may see a debtor instead. The key point is that both sides of the balance sheet must balance. Notes to the accounts: A standard note is required confirming that the company was dormant throughout the period and that the directors are satisfied the company was entitled to prepare accounts in accordance with Section 480 of the Companies Act 2006. This section exempts dormant companies from the requirement to appoint auditors and allows them to file simplified accounts. Director's statement: The accounts must include a formal statement that they have been prepared in accordance with the provisions of the Companies Act 2006 applicable to companies subject to the small companies regime — specifically the small companies regime provisions (which covers both micro-entities and small companies). At least one director must approve the balance sheet, and their name must appear on the filed accounts. The period covered: The accounts must clearly state the accounting period they cover. For most dormant companies, this is a 12-month period ending on the accounting reference date. However, the first accounting period can be longer (up to 18 months from incorporation for Companies House purposes), and you should take care to ensure the dates match what Companies House expects. What is NOT included: Dormant accounts do not require a profit and loss statement, a directors' report, a strategic report, an auditor's report, or a cash flow statement. There is no need for detailed notes on accounting policies, employee numbers, directors' remuneration, or any of the other extensive disclosures required for trading companies. This simplicity is one of the major advantages of maintaining true dormant status — the filing is minimal, quick, and costs nothing to prepare if you do it yourself.

After helping thousands of company directors file their accounts, we have seen the same mistakes come up repeatedly with dormant filings. Here are the ones to watch out for: 1. Missing the filing deadline entirely. This is by far the most common mistake. Because the company has no business activity, there are no natural triggers — no quarterly VAT returns, no payroll, no client invoices — to remind you that a filing is due. Many directors set up a dormant company with good intentions, then simply forget about it. The first sign of trouble is often a penalty notice landing on the registered office doormat months after the deadline has passed. Setting up a recurring calendar reminder or using WeFile's upcoming filing notifications is the easiest way to prevent this. 2. Filing dormant accounts when the company is not actually dormant. If your company had even one bank transaction beyond the two permitted exceptions (subscriber shares and Companies House filing fees), it is not dormant for Companies House purposes. Common culprits include bank charges or interest, standing orders you forgot to cancel, insurance policy auto-renewals, domain name renewals, or Companies House's own annual confirmation statement fee being debited from the company bank account. Filing incorrectly as dormant when you have had such transactions means your accounts are factually wrong and could be rejected or flagged during a review. 3. Confusing HMRC dormancy with Companies House dormancy. Directors frequently assume that once HMRC has accepted their company as dormant, they have no filing obligations at all. This is incorrect. Companies House is a completely separate body with its own requirements. You must still file annual accounts and a confirmation statement with Companies House regardless of what HMRC says. 4. Failing to notify HMRC when trading resumes. If your dormant company starts trading, you are legally required to tell HMRC within 3 months. Failure to do so can result in penalties, and you will owe interest on any Corporation Tax from the date it became payable — not the date you finally got around to telling HMRC. Directors sometimes start small projects through their dormant company without realising that the very first invoice triggers this obligation. 5. Getting the accounting period dates wrong. Your accounting reference date (ARD) is set automatically when the company is incorporated — it defaults to the last day of the month in which the company's annual anniversary of incorporation falls. If you have never changed it, it may not be what you expect. Filing accounts for the wrong period will lead to rejection by Companies House. Always verify your ARD on the Companies House public register before starting any filing. 6. Not filing a confirmation statement. Some directors focus exclusively on the annual accounts and forget the confirmation statement entirely. This is a separate obligation and carries its own penalties for late delivery. Companies House can even begin proceedings to strike off a company that has not filed its confirmation statement. 7. Assuming the company will be automatically struck off. Some directors believe that if they simply ignore a dormant company, Companies House will eventually strike it off and the problem will go away. While Companies House does have the power to strike off companies that appear to be defunct, this is not guaranteed and can take years. In the meantime, penalties continue to accumulate against the directors personally.

Yes — and it is an important distinction that many directors overlook, often leading to incorrect filings. A dormant company has had no significant accounting transactions whatsoever during the period. A non-trading company may not be actively carrying on business but could still have accounting transactions in its bank account — for example, bank interest received, insurance costs, professional fees, software subscriptions, or even a refund from a cancelled service. The filing implications are very different. A dormant company can file simplified AA02 accounts with just a balance sheet and minimal notes. A non-trading company with transactions must file micro-entity or small company accounts, which include a profit and loss account (even if it just shows a small loss from bank charges), more detailed balance sheet notes, and potentially additional disclosures depending on the size of the transactions. The HMRC position is also different. A non-trading company that has any form of income — even just £3.50 of bank interest — technically has a Corporation Tax obligation. You would need to file a CT600 return declaring that income. In most cases the actual tax due will be nil or negligible, but the return itself is still required if HMRC has issued a notice to deliver. A real-world example: Sarah incorporated a company two years ago to hold a property she planned to develop. The development never started, and she has done nothing with the company. However, the company bank account earned £8.12 in interest and was charged £5 per month in account maintenance fees over the year. Sarah assumes the company is dormant, but it is not — those transactions mean she needs to file micro-entity accounts with Companies House and potentially a CT600 with HMRC. Practical advice: If you want to maintain true dormant status, ensure your company bank account has zero activity. Close the account entirely if possible, or switch to a fee-free account and request that interest is not paid. Cancel all standing orders, direct debits, and automatic renewals. Even a single £5 bank charge could technically be the difference between a 10-minute dormant filing and a more complex set of accounts that requires accounting knowledge.

Understanding the legal basis for dormant company filing can help directors appreciate why the rules exist and what protections they offer. Section 480 — Dormant companies: exemption from audit. This is the primary provision that benefits dormant companies. It states that a company which has been dormant since its formation, or which has been dormant since the end of the previous financial year, is exempt from the requirement to have its accounts audited. This saves directors the significant cost of engaging an auditor — which can range from several hundred to several thousand pounds for even small companies. Section 1169 — Definition of dormant. This section provides the legal definition of dormancy. A company is dormant during any period in which it has no significant accounting transactions. A significant accounting transaction is any transaction that is required to be entered in the company's accounting records under Section 386, excluding payment for shares by subscribers to the memorandum and payment of fees to the Registrar. Section 472A — Micro-entity provisions. Some dormant companies may also qualify as micro-entities, which provides additional simplification. A micro-entity must meet at least two of these criteria: turnover not exceeding £632,000, balance sheet total not exceeding £316,000, and no more than 10 employees. Most dormant companies comfortably meet these thresholds, entitling them to prepare the simplest possible form of accounts. What this means in practice: The law deliberately makes it easy and cheap to keep a dormant company on the register. The filing requirements are minimal, there is no audit requirement, and the accounts themselves are just a page or two. The intention is that the cost and effort of maintaining a dormant company should be proportionate to its activity level. The challenge for directors is simply remembering to file on time — the actual preparation of the accounts is straightforward.

Filing dormant accounts does not need to be complicated or expensive. WeFile was designed specifically to make this process as smooth as possible for UK company directors — whether you are filing for one company or managing multiple dormant entities. Here is how the process works, step by step: 1. Add your company. Search for your company by name or registration number, and WeFile automatically imports your company details directly from the Companies House API. This includes your registered office, directors, accounting reference dates, and filing history. There is no manual data entry — everything is pulled in automatically and verified against the official register. 2. Create a filing. WeFile analyses your company's filing history and accounting reference date to determine which periods need filing. Select the relevant period, and if your company is dormant, choose the dormant filing option. The wizard automatically adjusts — removing unnecessary sections like the profit and loss statement and simplifying the balance sheet to only the fields relevant to dormant accounts. 3. Review the balance sheet. For most dormant companies, this is simply confirming your share capital and shareholders' funds. If your company was formed with one ordinary £1 share, WeFile will pre-populate the standard entries. You review them, make any adjustments if needed, and move on. Each field has a clear explanation so you know exactly what you are confirming. 4. Enter your submission credentials. Provide your Companies House authentication code (the 6-character code sent to your registered office) and/or your HMRC Government Gateway credentials, depending on whether you are filing with Companies House, HMRC, or both. These credentials are used solely for the submission and are handled securely throughout the process. 5. Review and submit. Before submission, WeFile shows you a complete summary of your filing so you can verify every detail. Once you are satisfied, hit submit. WeFile generates the required iXBRL-tagged documents — the same machine-readable format mandated by both Companies House and HMRC — and submits them electronically on your behalf. You will receive a confirmation with the submission reference once it is accepted. The entire process typically takes under 10 minutes for a dormant company. Compare that to the alternative: manually navigating government portals, potentially filling in the wrong form, risking formatting errors in the iXBRL markup, and spending hours on something that should take minutes. WeFile also keeps a complete record of all your filings, so you can refer back to previous periods at any time. For directors managing multiple dormant companies — which is common for property holding structures, group companies, or directors who maintain shelf companies — WeFile lets you manage all of them from a single dashboard, with upcoming deadline notifications for each one.

Staying on top of your deadlines is crucial — and for dormant companies the biggest risk is simply forgetting, since there is no business activity to act as a natural reminder. Here is the complete reference for 2026: Companies House annual accounts: — Private limited companies: due 9 months after the accounting reference date (ARD) — Public limited companies: due 6 months after the ARD — First accounts after incorporation: due 21 months from the date of incorporation, or 9 months from the ARD, whichever is longer — Example: if your ARD is 31 March 2026, your accounts are due by 31 December 2026 HMRC Corporation Tax return (CT600): — Due 12 months after the end of your accounting period — Corporation Tax payment (if any is owed): due 9 months and 1 day after the end of your accounting period — Example: for a period ending 31 March 2026, the CT600 is due by 31 March 2027 and any tax owed by 1 January 2027 Confirmation statement (Companies House): — Due at least once every 12 months from the date of incorporation or the date the last statement was made up to — Filing fee: £50 online, £110 on paper — Unlike accounts, there is no set deadline — it simply must be filed at least once in every 12-month review period Penalty escalation reminder: If you filed late last year and file late again this year, the Companies House penalties double. A first-time late filing of 3–6 months costs £750, but a second consecutive late filing for the same period costs £1,500. Pro tip: Set calendar reminders at least 6 weeks before each deadline to give yourself time to prepare. Even better, register your companies on WeFile — we send email notifications when your filing deadlines are approaching, so you will never be caught off guard.

If your company has been dormant for an extended period and you have no plans to use it in the foreseeable future, it is worth seriously considering whether to strike it off the Companies House register entirely. Keeping a dormant company alive costs time, attention, and money — and for many directors, the benefits simply do not justify the ongoing obligations. Voluntary strike-off (DS01) is a straightforward process where the directors apply to Companies House to have the company removed from the register. To be eligible, the company must meet all of the following conditions: — It has not traded or carried on any business in the last 3 months — It has not changed its name in the last 3 months — It is not subject to any insolvency proceedings (liquidation, administration, etc.) — It has not made any disposals for value that would result in gains — It has no outstanding debts or liabilities to creditors, HMRC, or any other party The application fee is £13 if filed online. Once submitted, Companies House publishes a notice in The Gazette giving third parties (creditors, HMRC, etc.) an opportunity to object. If no objections are raised within 2 months, the company is dissolved — typically around 3 months from the date of application. Before applying, make sure you have: — Filed all outstanding accounts and confirmation statements with Companies House — Filed any outstanding CT600 returns with HMRC — Closed the company bank account and distributed any remaining assets to shareholders — Notified HMRC that the company is being struck off (HMRC can and will object if they believe outstanding tax matters exist) — Informed any other relevant parties (banks, insurers, service providers) Benefits of striking off: No more annual filing obligations, no more filing fees, no more risk of forgotten deadlines and automatic penalties, and no more concern about maintaining compliance. If you need a limited company again in the future, you can incorporate a new one within 24 hours for as little as £50. Reasons to keep the company: Some directors prefer to retain a dormant company for future use — perhaps they plan to trade again in the next year or two, they want to preserve a particular company name, or the company holds an asset (such as intellectual property or a domain name) that would be complicated to transfer. There may also be a reputational benefit — a company incorporated in 2010 may carry more credibility than one formed yesterday. These are all valid reasons, but the decision should be active and deliberate rather than the result of inertia. A middle ground: If you are unsure, review the situation annually. As long as you are filing on time each year, there is no harm in keeping the company active. But if you find yourself forgetting deadlines, paying late filing penalties, or simply being annoyed by the obligation, striking off is probably the right choice.

Use this checklist to make sure you are staying on top of your obligations throughout the year: Annual tasks: — Verify your accounting reference date on the Companies House register — File dormant accounts (AA02) within 9 months of your ARD — File your confirmation statement within 12 months of the previous one — Pay the £50 confirmation statement fee — Check whether HMRC has issued a notice to deliver a CT600 — if so, file it even if the company is dormant — Review your company's bank account for any unexpected transactions that could break dormancy Ongoing awareness: — Keep your registered office address up to date — penalties and notices are sent there — Ensure at least one director's correspondence address is current — Monitor for any correspondence from HMRC, particularly notices to deliver returns — If the company starts any form of business activity, notify HMRC within 3 months — Keep records of your dormancy — a simple note confirming no transactions occurred during the period Periodic review: — Once a year, ask yourself: do I still need this company? — If the answer is no, start the voluntary strike-off process (DS01) — If the answer is yes, make sure your upcoming filing dates are in your calendar or set up on WeFile If you have missed a deadline: — File as soon as possible — the penalty amount depends on how late you are, so every day counts — Do not ignore the penalty notice, but also do not wait for one before filing — Consider whether the company should be struck off to avoid repeat penalties in future years

Can I file dormant accounts myself, or do I need an accountant? You can absolutely file them yourself. Dormant accounts are the simplest form of statutory accounts — typically just a one-page balance sheet and a short note — and any company director can prepare and submit them. Using a platform like WeFile makes it even easier, as the wizard guides you through every step and generates the iXBRL documents automatically. You do not need any accounting qualifications to file dormant accounts. How much does it cost to file dormant accounts? Filing directly with Companies House and HMRC through their own portals is free (though HMRC's free tool is being phased out). WeFile offers competitive pricing that includes generating the correct iXBRL-tagged documents, submitting electronically to both Companies House and HMRC, and keeping a full record of your filing for future reference. What if my company was dormant for part of the year and trading for the rest? You cannot file dormant accounts for a period in which any trading took place. You will need to file full accounts for the entire accounting period, even if most of it was dormant. If you know in advance when you will start trading, it may be worth considering changing your accounting reference date so that the dormant period and the trading period fall into separate financial years — this can simplify things considerably. My company has a bank account with a small balance — is it still dormant? Having a bank account does not automatically break dormancy. What matters is whether there have been any significant accounting transactions during the period. If the account has sat untouched with the original balance, no charges, no interest, and no fees, the company can still be dormant. However, if the bank has applied any charges, paid any interest (even pence), or if any direct debits have gone through, the company is no longer dormant for Companies House purposes. Can a dormant company have employees or directors who receive a salary? No. If a company has employees, it is carrying on business and is not dormant. Directors do not need to be paid — it is perfectly normal for directors of dormant companies to serve without remuneration. However, if a director does receive any payment from the company, the company is no longer dormant. How long can a company stay dormant? Indefinitely. There is no legal time limit on dormancy. Some companies remain dormant for decades, filing their annual accounts and confirmation statements each year. As long as you continue to meet your filing obligations, there is nothing wrong with maintaining a dormant company on the register for as long as you wish. What happens if Companies House strikes off my company? If your company is struck off — whether voluntarily or by compulsion — it ceases to exist as a legal entity. Any assets the company held (including bank balances, property, or intellectual property) become 'bona vacantia' and pass to the Crown. You can apply to have the company restored to the register within 6 years, but this involves a court application and can cost several hundred pounds in legal fees. It is always better to proactively manage your company than to let it be struck off by default. Do I still need to file if I have applied for voluntary strike-off? Yes. Until the company is formally dissolved and removed from the register, all filing obligations remain in place. The strike-off process typically takes around 3 months, and you must continue to file accounts and confirmation statements during that time. If your filing deadline falls before the company is dissolved, you must still file — or you will receive a penalty.