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HMRC internal manual

Debt Management and Banking Manual

Debt and return pursuit: PAYE: cessation, cancellation and Cancelled One Year Only (COYO): cessations: Bona Vacantia

When a company is dissolved (struck-off) it ceases to be a legal entity and all its property and rights pass to the Crown under the Companies Act 2006 as “Bona Vacantia” (BV), meaning ownerless property.

It depends on where the dissolved company’s last registered office was situated as to where the BV rights lie and which authority has jurisdiction.

See Bona Vacantia Guidance for more information.

If there are any debts arising from before the company was dissolved, reallocation/set-off should be considered before being dealt with under Bona Vacantia - see BVG1050.

Transferring payments under Bona Vacantia

PAYE Employer Office will send form P565 to DMB Banking giving the necessary details for the repayment to be made to the appropriate jurisdiction.

The relevant BV jurisdiction can repay directors or shareholders of dissolved companies by application of Bona Vacantia. Failing this, the directors/shareholders can apply to Companies House to restore their company, but both of these actions will incur costs.

If one of the BV jurisdictions (listed in the Bona Vacantia Guidance) asks you to transfer an overpayment to them under Bona Vacantia take the following action.

If the overpayment has previously been transferred to OAS

If the money is in Permanent Overpayments (POP):

  • arrange with DMB Banking for the overpayment to be brought back from POP
  • ask DMB Banking to liaise with PAYE Employer Office to prepare a P565 to repay the overpayment to the appropriate BV authority
  • advise the BV authority that you are arranging transfer to them.

If the overpayment is on the company record

  • Set the Potential Cessation Date on ETMP.
  • Add a note to ETMP and IDMS showing that:

    • the company has been dissolved and struck off
    • there is an overpayment remaining on record.
  • Ask them to:

    • consider their Bona Vacantia (BV) guidance
    • issue a form P565 to repay the overpayment to the appropriate BV authority.
  • Note ETMP (or BROCS if that is where the overpayment sits) with “No Rep/realloc. P565 for BV to follow”.
  • Advise the BV authority that you are arranging transfer to PT Ops for them to review whether there is an overpayment that needs to be transferred to the BV authority and give the PT Ops reference.

If you receive a query from a director, shareholder or agent about Bona Vacantia you should:

  • advise that you cannot discuss the matters of the former company
  • refer them to the website .