Striking off or dissolving a limited company

Question 1

1. Voluntary strike off

Accepted Answer

Any company can apply to the Registrar of Companies to be struck off the Companies House register and dissolved. This is called voluntary strike off.

1.1 Who can apply

The application needs to be made by the majority of directors of the company. If there are only 2 directors, both directors must apply. If there’s only one director, that director can apply.

You may wish to apply for strike off if the company is no longer needed, for example if the:

directors wish to retire and there is no one to take over the running of the company
company is a subsidiary whose name is no longer needed
company was set up to pursue an idea that turned out not to be feasible

You may be able to apply for strike off if your company is dormant or no longer trading. This is not an alternative to formal insolvency proceedings.

Even if the company is struck off and dissolved, creditors and others could apply for the company to be restored to the register.

1.2 Criteria for strike off

You cannot apply for strike off if, in the last 3 months, your company:

has traded or carried on business
has changed its name
has made a disposal for value of property or rights that it held for the purpose of disposal for gain in the normal course of trading or carrying on business – for example, a company that sold apples could not continue selling apples, but it could sell the truck it once used to deliver the apples

You cannot apply for strike off if, in the last 3 months your company has engaged in any activity other than one that’s necessary to:

apply for strike off or decide whether to do so, for example seeking professional advice on the application or paying the strike off application fee
conclude the affairs of the company, such as settling trading or business debts
comply with a statutory requirement

You also cannot apply for strike off if the company is the subject, or proposed subject, of:

insolvency proceedings such as liquidation, including where a petition has been presented but has not yet been dealt with
a compromise or arrangement between a company and its creditors or members, known as a section 895 scheme

It’s an offence to apply for strike off if your company is not eligible. You could receive a fine.

See section 1004 and section 1005 of the Companies Act 2006 for all circumstances where a company may not apply for strike off.

1.3 Before you apply

Before applying for strike off, you must close down your company properly.

You must also inform people who are likely to be affected by a company’s dissolution, including:

creditors
members
employees
organisations or parties who might have in interest in the company’s affairs like HRMC, local authorities, training and enterprise councils and government agencies

1.4 How to apply and who to tell

Apply to strike off and dissolve your company.

Who you must tell about the application

Within 7 days of applying, you must send a copy of the strike off application to:

members, usually the shareholders
existing and likely creditors such as banks, suppliers, former employees that the company owes money, landlords or tenants (for example, where a bond is refundable), guarantors, personal injury claimants, HMRC and Department of Work and Pensions (DWP)
employees
managers or trustees of any employee pension fund
any directors who have not signed the application form

You must also send a copy of the application to anyone who, after the application has been made, becomes a:

director
member
creditor
employee
manager or trustee of any employee pension fund

This must be done within 7 days of the person becoming one of these. This obligation continues until the dissolution of the company or the withdrawal of the application.

You will be committing an offence if you do not notify the relevant parties. You could get a fine or, in the most serious cases, a maximum of a 7 year prison sentence.

How to tell interested parties about the application

You can post a copy of the completed application to, or leave it at:

an individual’s last known address
a company or other body’s principal or registered office address

You can also notify a creditor by leaving a copy of the application at, or posting it to, the place of business the company has had dealings with in relation to current debts. For example, the branch you ordered goods from, or which invoiced you. If there’s more than one, you should deliver a copy of the application to each of these places.

It is advisable to keep records of proof of delivery or posting the application.

1.5 After you apply

Companies House will examine your application and, if it’s acceptable, will:

register the application and put it on the public register of companies
send an acknowledgement to the address on the application
notify the company at its registered office address
publish notice of the proposed striking off in the relevant Gazette
place a copy of the Gazette notice on the company’s record

If there is no reason to delay, the registrar will strike off the company not less than 2 months after the Gazette notice is published.

Companies House will publish a second notice in the relevant Gazette, and the company will be dissolved.

The company’s bank account will be frozen from the date of dissolution. Any credit balance in the account will pass to the Crown. Any assets of a dissolved company will also belong to the Crown.

The Gazette

The Gazette is the official newspaper record in the UK. There are 3 Gazettes - the:

London Gazette, for companies incorporated in England and Wales
Edinburgh Gazette, for companies incorporated in Scotland
Belfast Gazette, for companies incorporated in Northern Ireland

Company strike off notices will appear in the Gazette for the part of the UK that the company was incorporated.

The Gazettes are published weekly.

You can also find Gazette notices by checking a company’s record on the Companies House register.

Find out more about the Gazettes.

1.6 Withdraw an application

You must withdraw the strike off application immediately, if the company:

changes its mind and no longer wants to be struck off
no longer meets the criteria for strike off

You can withdraw your application for strike off online or by post.

Read the full circumstances of when you must withdraw an application for strike off. You may be committing an offence if you do not withdraw your application under these circumstances.

1.7 If you do not follow the requirements

There could be serious consequences if you do not comply with the requirements when making an application to strike off the company. It is an offence:

to apply for strike off when the company is ineligible
to provide false or misleading information in, or in support of, an application
not to send a copy of the application to all relevant parties within 7 days
not to withdraw application if the company becomes ineligible

You could receive a potentially unlimited fine on summary conviction (before a magistrates’ court or Sheriff Court) or an unlimited fine on indictment (before a jury).

If you do not give a copy of the application to relevant parties with the intention of concealing the application, you could go to prison for up to 7 years and receive an unlimited fine.

You may also be disqualified from being a director for up to 15 years.

Find out more about how Companies House enforces the law.

Question 2

2. When the registrar can strike off a company

Accepted Answer

In some circumstances, the Registrar of Companies can strike your company off the register.

2.1 If the company is not carrying on business or in operation

The registrar may commence steps to strike a company off the register, if they have a reasonable cause to believe the company is not carrying on business or in operation.

The registrar may form this view if:

they have not received annual documents that the company should have sent, like its confirmation statement or accounts
the company has no directors

Before striking a company off the register, the registrar will try to communicate with the company to ask whether it’s still carrying on business or in operation.

If the registrar is satisfied that it’s not, for example, if the company does not respond, they will publish a notice in the relevant Gazette. This notice will state the registrar’s intention to strike the company off the register unless they’re given reason not to do so.

A copy of the Gazette notice will be placed on the company’s public record.

If the registrar sees no reason to do otherwise, they will strike off the company not less than 2 months after the Gazette notice is published.

The company will be dissolved on publication of a further notice stating this in the relevant Gazette.

2.2 If the company was registered on a false basis

The registrar may commence steps to strike a company off the register if they have a reasonable cause to believe that the company was registered on a false basis. This means if they have reason to believe one of the following:

any information contained in the application for the registration of the company, or in any application for administrative restoration of the company to the register, is misleading, false or deceptive in a material particular
any statement made to the registrar in connection with such an application is misleading, false or deceptive in a material particular

The registrar may also consider information in any documents delivered to them as part of an application for registration or administrative restoration.

When the registrar has formed their belief that company information meets the threshold for being registered on a false basis, they will publish a notice in the relevant Gazette. This notice will state their intention to strike the company off the register unless they’re given reason not to do so.

A copy of the Gazette notice will appear on the company’s public record.

If the registrar sees no reason to do otherwise, they will strike off the company not less than 28 days after the Gazette notice is published.

The company will be dissolved on publication of a further notice stating this in the relevant Gazette.

2.3 If the company does not change its registered office address from the default address

Companies must have an ‘appropriate address’ as their registered office address at all times.

If the registrar is satisfied a company does not have an appropriate registered office address, they may change it to an address held and maintained at Companies House. This is called a ‘default’ address.

The company can choose to appeal to court against the registrar’s decision.

If the company does not appeal, it has 28 days to deliver a notice changing its registered office address from the default address. The new registered office address must be an appropriate address.

Check the rules for registered office addresses.

If a company fails to change their registered office within 28 days from being moved to the default address, the registrar may commence steps the strike the company off the register.

Before striking a company off the register, the registrar will publish a notice in the relevant Gazette stating their intention to strike the company off the register unless they’re given reason not to do so.

A copy of the Gazette notice will appear on the company’s public record.

If the registrar sees no reason to do otherwise, they will strike off the company not less than 2 months after the date of the publication of the Gazette notice. The company will be dissolved on publication of a further notice stating this in the relevant Gazette.

2.4 Stop your company being struck off

If the registrar is striking off your company as they believe it is no longer in business or in operation, you should:

reply promptly to any enquiry letters from the registrar
deliver any outstanding documents as soon as possible

If the registrar is striking off your company as they believe it was formed on a false basis, you will need to give evidence which satisfies the registrar that they did not have a reasonable cause to believe this.

If the registrar is striking off your company as its registered office is at the default address, you should:

deliver a notice to Companies House changing your registered office address from the default address
include evidence that the new address is appropriate and that you own or have the right to use the address

Question 3

3. Assets of a dissolved company

Accepted Answer

From the date of dissolution, any assets of a dissolved company will pass back to the Crown. These ownerless assets are known as ‘bona vacantia’, which means ‘vacant goods’.

The company’s bank account will be frozen and any credit balance in the account will be passed to the Crown.

You should address any enquiries about bona vacantia property to the appropriate department.