People often use dormant to mean the same thing across Companies House and HMRC. It does not work that way. A company can be dormant for one and active for the other.
Either way, the filing duty stays in place. A dormant company still files annual accounts and a confirmation statement. Miss the accounts deadline and the penalty starts at £150. Trading companies pay the same penalty.
This guide explains both definitions, what you still file, and what breaks dormancy.
Quick answer
Companies House calls a company dormant if it has had no significant transactions in the year. HMRC calls it dormant for Corporation Tax once trading stops. It also needs no other income. You still file accounts and a confirmation statement. Penalties still apply.
What makes a company dormant for Companies House?
A company is dormant for Companies House if it has had no significant transactions in the financial year. Three things do not count: filing fees paid to Companies House, penalties for late filing of accounts, and money paid for shares when the company was formed. Anything else going through the books ends dormancy for that year.
GOV.UK explains this under dormant for Companies House.
Those exclusions matter. They mean a company can pay its own filing fee and still stay dormant.
Anything else counts. A bank charge counts. A supplier invoice counts. Even a pound of interest counts.
That is why dormant companies usually keep the bank account closed or untouched. One direct debit for a domain name is enough to break dormancy.
A small dormant company can file dormant accounts instead of full accounts. It does not need an auditor’s report.
What makes a company dormant for Corporation Tax?
HMRC uses a different test. A company is dormant for Corporation Tax once trading stops and it has no other income. A company that has not started trading yet also counts. So does a flat management company. So does a club that owes under £100.
The definition of trading is wider than many owners expect. GOV.UK sets it out under dormant for Corporation Tax.
Trading includes:
- buying and selling
- renting property
- advertising
- employing someone
- getting interest
Advertising is the one that catches people out. A company running ads while it prepares to launch is trading, even if it has no sales.
Tell HMRC when the company stops trading. After that, you do not file a Company Tax Return unless HMRC sends a notice asking for one.
Two clean up jobs usually come with that step. If you are registered for VAT and not restarting, deregister within 30 days. If you employ people and will not trade again that tax year, close the PAYE scheme.
What does a dormant company still have to file?
A dormant company still files annual accounts and a confirmation statement every year. Dormancy changes the accounts, not the filing duty. The confirmation statement still costs £50 online. Directors of dormant companies still need identity verification.
Filing duty follows the company itself, not whether it is trading.
- Annual accounts. Dormant accounts are allowed. Due 9 months after the year end.
- Confirmation statement. Due 14 days after the review period ends.
- Company Tax Return. Only if HMRC asks. Due 12 months after the accounting period.
- Event filings. File them when they happen. Most are due within 14 days.
The Companies House fees page puts the online confirmation statement at £50 and the paper version at £110. That guidance was updated on 2 July 2026.
See annual filing requirements at Companies House for the full calendar. Dormant companies follow the same dates.
Do penalties still apply to a dormant company?
Yes. A late filing penalty still applies in full. It starts at £150 and reaches £1,500 once the filing is more than six months late. The penalty doubles if you file late two years in a row. Companies House does not cut the penalty just because the company was dormant.
GOV.UK lists the late filing penalties with no dormant exemption:
- Up to 1 month. £150.
- 1 to 3 months. £375.
- 3 to 6 months. £750.
- More than 6 months. £1,500.
This is where dormant companies cost people money. Nothing is happening, so the deadline slips past before anyone notices.
There is another risk. Companies House can strike off a company that stops filing. That may sound convenient. Then you find out what happens to any assets left in the company.
Should you keep a company dormant or close it?
Keep the company dormant if you plan to trade again. Do the same if you want to keep the name. Close it if you are finished. Dormancy costs a filing fee and a bit of admin each year. Closing ends the filing duty, but you cannot restart a closed company.
Dormancy suits three situations: a pause between contracts, a name you want to hold, or a company set up early for a launch that was delayed.
Closing suits one situation: you are done.
Read how to close a limited company before you simply stop filing. It covers the routes and the costs.
Stopping without closing is the worst option. You collect penalties, then get struck off anyway. Any money left in the company passes to the Crown.
What about a new company?
A company that is registered but has not started trading yet is dormant for Corporation Tax from the start. It stays dormant for Companies House as long as nothing significant goes through the books. Paying the share money for incorporation does not break dormancy. A first supplier invoice does.
Many people set up a limited company months before they trade. That is normal.
Two habits help keep it clean while you wait. Do not open the bank account until you need it. Do not sign up for anything with a monthly charge.
Tell HMRC the company is not trading yet. If you do not, a notice to file can arrive even though the company did nothing all year.
Keeping a dormant company tidy
Keep track of two dates only: the accounts deadline and the confirmation statement date.
Keep the bank account empty or closed. One stray charge can break a year of dormancy.
Check the register once a year. If the registered office is out of date, the company can miss its post.
DASA’s company formation service also helps with dormant filings for companies waiting to trade. Tell us your year end date and whether the company has ever traded, and we’ll send a quote with current pricing.
This article provides general information about dormant companies in the UK. It is not financial, tax or legal advice. Every company is different. Speak to a qualified accountant about your situation.
Frequently asked questions
What makes a company dormant for Companies House?
No significant transactions in the financial year. Filing fees paid to Companies House, penalties for late filing of accounts, and money paid for shares when the company was formed do not count. Anything else going through the books ends dormancy for that year.
What makes a company dormant for Corporation Tax?
HMRC treats a company as dormant if it has stopped trading and has no other income. A company that has not started trading yet counts, as does a flat management company or a club owing under £100.
Do dormant companies still have to file accounts?
Yes. A dormant company files annual accounts and a confirmation statement every year. Dormancy changes what goes in the accounts, not the duty to file. A small dormant company can file dormant accounts with no auditor’s report.
Do late filing penalties apply to a dormant company?
Yes, in full. Late accounts bring £150 up to one month late, rising to £1,500 beyond six months. The penalty doubles if you file late two years in a row. Companies House does not reduce it for a dormant company.
Does advertising end a company’s dormant status?
Yes for Corporation Tax. HMRC counts advertising as trading, along with buying, selling, renting property, employing someone and getting interest. A company running ads before launch is trading even with no sales.