How to Close a Limited Company That Never Traded

Learn how to close a UK limited company that never traded, including strike-off steps and HMRC guidance

Not every limited company ends up trading. You might have registered a company in preparation for a new business idea that never got off the ground, or as a backup plan that you no longer need. If your limited company has never traded, closing it down is usually simple and cost-effective, but you still need to follow the proper steps.

This guide explains how to close a limited company that never traded, what qualifies as a non-trading company, and how to avoid penalties or mistakes along the way.

What does “never traded” mean?

A company is considered non-trading if it has:

  • Not sold any goods or services

  • Not employed anyone

  • Not received income or incurred expenses (other than setup costs)

  • Not operated a business bank account for trading

  • Not registered for VAT or PAYE

If your company has done none of the above since incorporation, it can usually be closed through a voluntary strike off, as long as it meets the eligibility conditions.

Can I just ignore it?

No. Even if your company has never traded, it still exists in the eyes of Companies House and HMRC. You must close it formally, or you risk late filing penalties, especially for the confirmation statement and annual accounts.

Steps to close a limited company that never traded

1. Check for outstanding obligations
Make sure your company has:

  • No assets, liabilities or debts

  • Not been involved in any legal action

  • Not changed its name in the last three months

  • Not traded or carried out any business activity since formation

If all of the above apply, you can apply for strike off.

2. Notify HMRC
If HMRC is aware of your company, let them know that the company never traded and you want to close it. You may have received a Corporation Tax UTR shortly after registering the company. Send HMRC a letter explaining that the company is dormant and request that no returns are required.

If the company was registered for VAT or PAYE, you must cancel these before proceeding with closure.

3. File any required documents
If Companies House has issued a deadline for annual accounts or a confirmation statement, and you miss it, you could be fined even if the company is dormant. Check if anything is due and file a dormant set of accounts if necessary.

4. Complete and submit form DS01
This is the formal application to strike the company off the Companies House register.

  • You can complete the form online or by post

  • The current fee is £44

  • It must be signed by the majority of company directors

  • Once submitted, Companies House will publish a notice in The Gazette

  • If no one objects within two months, the company will be dissolved

5. Inform all interested parties
You must notify any shareholders, company officers, accountants, banks, or insurers of your intention to strike off the company within seven days of submitting the DS01 form.

6. Wait for confirmation
Companies House will strike off the company after two months if no objections are raised. You will receive confirmation of dissolution in writing.

Do I still need to file accounts?

If your company has been dormant since incorporation, you may need to file a set of dormant accounts with Companies House before applying for strike off, depending on how long the company has been active on the register.

If you are closing the company shortly after incorporation (within a few months), and before any filing deadlines have passed, you may not need to file accounts at all, but it is always best to check.

Real-world example

Jake set up a limited company in March 2024 with the intention of launching a clothing brand. He never opened a business bank account, took no income and never started trading. In July 2025, he decides to close the company. He confirms with HMRC that the company is dormant and files a DS01 form with Companies House. After two months with no objections, the company is struck off the register.

Final thoughts

If your limited company has never traded, closing it is usually quick and inexpensive. But it still requires action. Ignoring the company can lead to unnecessary filing requirements, reminders from HMRC, or penalties for non-compliance.

By following the correct steps and submitting the DS01 form, you can formally dissolve the company and move on with peace of mind.