How to Make a Company Dormant on Companies House

Before reading this article we recommend that you read our guidance article explaining what is a dormant company on Companies House.

There may come a time when you want to pause your business without closing it completely. In these cases, putting your company into a dormant state can be a useful option. A dormant company remains legally registered with Companies House but is not actively trading or earning income. It can help you maintain control of a company name, pause operations while planning a restructure, or hold a company for future use.

If you are considering making your company dormant, it is important to follow the correct steps to avoid penalties and ensure Companies House and HMRC both recognise the change. Our team of limited company accountants can guide you through the entire process, from notifying HMRC to preparing and filing dormant company accounts accurately. We will ensure your confirmation statements are submitted on time, your statutory registers are up to date, and that your company remains compliant while inactive. Whether your business is pausing temporarily or being held for future use, we will manage the transition smoothly and professionally.

In this article, we explain how to make your company dormant, what steps you need to take with Companies House and HMRC, and what ongoing responsibilities still apply.

What Does Dormant Mean?

A dormant company is one that is not carrying on any business activity and has no significant financial transactions during its accounting period. It remains legally registered but is not considered active for tax purposes. Companies House and HMRC both recognise dormancy, but they define and treat it slightly differently.

To be dormant:

• The company must not trade or receive income

• It must not pay staff, issue invoices, or operate a business bank account

• It may still pay small fees such as the Companies House filing fee or initial share capital

Step 1: Cease Trading and Close Accounts

Before your company can be classed as dormant, you must stop all trading activity. This includes:

• Issuing invoices

• Receiving payments

• Paying suppliers or staff

• Making bank transactions

You should also settle any outstanding debts, close business bank accounts, and cancel VAT registration if applicable. It is advisable to inform your accountant and update your internal records accordingly.

Step 2: Notify HMRC That Your Company Is Dormant

HMRC must be told that your company is no longer trading. You can do this:

• Online using your Corporation Tax account

• By writing to HMRC if you do not have online access

If HMRC agrees your company is dormant, they will stop sending Corporation Tax reminders or requesting Company Tax Returns. It is important to wait for HMRC confirmation before assuming that no further tax filings are needed.

Step 3: File Dormant Company Accounts with Companies House

Even if your company is not trading, you still need to file accounts with Companies House each year. These are known as dormant accounts, and they are much simpler than full trading accounts.

Dormant company accounts include:

• A balance sheet confirming the company is dormant

• Statements confirming there have been no significant transactions

• Any necessary updates to director or shareholder details

You can file these online using Companies House WebFiling.

Step 4: Continue Filing a Confirmation Statement

Dormant companies must still file a Confirmation Statement at least once every 12 months. This confirms that your company details, such as directors and registered office address, are up to date. You can file it online for £13. This is a legal requirement, even if the company remains inactive.

Step 5: Keep Statutory Registers Up to Date

Even while dormant, your company must maintain accurate records of:

• Directors

• Shareholders

• Registered office address

• People with significant control

These records must be available for inspection if requested by Companies House or HMRC.

Final Thoughts

Making a company dormant is a practical option for business owners who want to pause operations without going through the process of closing the company. It protects your company name, allows flexibility in future planning, and reduces filing requirements. However, it does not eliminate all responsibilities. You still need to keep records up to date and file annual documents with Companies House.

If you want to make your company dormant correctly and avoid future penalties, it is worth getting professional guidance to ensure all the right steps are taken. For small companies and sole directors, putting a company into dormancy can feel more complex than expected. There are still filing responsibilities, and getting one step wrong could result in late filing notices or loss of dormant status. Our small company accountant service offers clear, cost-effective support for micro-businesses that want to protect their company name or pause trading without unnecessary stress. We will handle all communication with Companies House, prepare dormant accounts, and make sure you meet all legal obligations year after year.

Unsure what to file, when to file it or how to stay compliant? Our Companies House Help hub walks you through it all.

You might also be interested in how to change company name on companies house.