Dormant Company UK: HMRC vs Companies House Rules in 2026

A dormant company is a UK company that exists on the register and does nothing.

"Nothing" is measured twice, by two bodies, with two different tests.

The short answer

Three things to hold on to:

• A company can pass one test and fail the other.
• Dormant never means nothing to file.
• Companies House has no dormancy form to fill in.

One word, two tests

GOV.UK opens its guidance with a warning: dormant "means different things" for Corporation Tax and for Companies House filings. Most guides blur the two, and that is where the wrong answers come from.

The HMRC test is about business. GOV.UK says a company is usually dormant for Corporation Tax if:

• it has stopped trading and has no other income
• it is a new company that has not started trading

Two further cases cover associations owing less than £100 in Corporation Tax and flat management companies. GOV.UK then defines the key word broadly: "Trading includes buying, selling, renting property, advertising, employing someone or getting interest."

The Companies House test is about bookkeeping. Section 1169 of the Companies Act 2006 reads: "A company is 'dormant' during any period in which it has no significant accounting transaction." A significant accounting transaction is one that must be entered in the company's accounting records.

What counts as a significant accounting transaction

The statute gives a closed list of payments that are ignored. GOV.UK summarizes it more loosely.

That is the whole list. Anything else that has to go in the accounting records ends dormancy for Companies House, whatever its size.

Three items come up constantly:

• Bank interest. GOV.UK names "getting interest" as trading, and interest is an entry in the books. The texts we read state no minimum amount.
• Bank charges. GOV.UK does not name them. On our reading of the statutory definition, a charge debited from the company's account is a transaction to record.
• A supplier paid from the company account. Same logic, and "buying" is on the GOV.UK list too.

One question is not settled by the texts: costs a director pays personally, such as a registered office or an accountant. The safe rule is narrow.

• A payment made by the company, or on its behalf, that must appear in its accounting records ends dormancy at Companies House.
• Whether a given out-of-pocket cost falls in that category is a question for an accountant.

The four cases

Two tests give four outcomes.

	Companies House: dormant	Companies House: not dormant
HMRC: dormant	Case 1. New company, shares paid on formation, nothing since	Case 2. New company not yet trading, with an entry in its books
HMRC: not dormant	Case 4. No transactions, but HMRC still expects a return	Case 3. Any company that trades or earns interest

Annual accounts and a confirmation statement are due in all four cases.

Case 2 is our reading of the two texts side by side, not an official example. A bank charge on an account opened before the first sale is the usual candidate. Have an accountant confirm it for your facts.

Case 4 is the rarest, and the texts give no clean example. Its practical form is procedural:

• the company has no transactions, but nobody has told HMRC it is dormant
• or HMRC has already sent a notice to deliver a Company Tax Return

Dormant is not a status you hold. It is a test you pass twice, under two different rulebooks, and you file something in all four cases.

A new company that has not started yet

This is the foreign founder's case: company formed, bank account not open, no sale. It is usually dormant on both tests.

• For HMRC, a new company that has not started trading is on the GOV.UK list.
• For Companies House, the shares taken on formation are ignored by section 1169.

The deadlines run anyway, from the date of registration.

The first accounts will be dormant accounts if the company is still dormant and qualifies as small. They are still accounts, with a due date.

What usually ends this quiet phase, in order of appearance:

1. the bank account opens and starts carrying charges or interest
2. the company pays its first supplier
3. the company issues its first invoice

What a dormant company still files

GOV.UK is blunt: "You must still file annual accounts and a confirmation statement." That holds whether the company is dormant for Corporation Tax, for Companies House, or both.

Dormant accounts are simplified accounts with no auditor's report. Their due dates and late penalties are those of any company, and the first penalty step is £150. The full calendar is in our guide to what a UK company files every year.

On the tax side, a notice from HMRC changes the picture.

• If a return was already filed, or a notice to deliver was received, a return is still due online.
• That return shows the company is dormant for the period.
• Filing it late costs a flat £200 first, even with nil figures.

The dates are set out with the Company Tax Return deadlines.

How to make a company dormant

Provider guides list two usual motives: holding a company name, or pausing a project. The method is the same either way.

1. Stop the activity. No sales, no purchases, no staff, no advertising, no rent, no interest.
2. Tell HMRC. If the company has stopped trading and has no other income, you can tell HMRC it is dormant.
3. Deal with VAT. With no plan to restart, deregister within 30 days of becoming dormant. With a plan to restart, send nil VAT returns.
4. Deal with payroll. If the company will not restart in the tax year, close the PAYE scheme.
5. Keep filing. Accounts and the confirmation statement continue.

Two points most guides get wrong:

• There is nothing to send to Companies House. The accounts you file show whether the company was dormant.
• HMRC can decide by itself. It may treat the company as dormant and write to say so. No Corporation Tax or return is then due.

Once HMRC has been told, the company pays no Corporation Tax and files no further return, unless a new notice arrives.

What ends dormancy

Dormancy is lost by doing something, not by filing something.

Restarting is asymmetric.

• Companies House. GOV.UK: "You do not need to tell Companies House if you restart trading." The next set of non-dormant accounts shows it.
• HMRC. The tax side has its own steps. Read the current GOV.UK page before the first sale, not after.

How long can a company stay dormant? The texts we read set no maximum. The limit is practical: the filings must keep arriving.

The trap: nothing happening is not nothing due

A dormant company is the easiest company to forget, and that is the risk. The pattern is always the same:

• no revenue, so no accountant
• no accountant, so no reminder
• no reminder, so no accounts and no confirmation statement

The registrar may strike a company off when it has reason to believe the company is not carrying on business, under section 1000. Administrative restoration costs £341, far more than the filings that were skipped.

£50Confirmation statement, online, every year

£150First penalty step for late accounts

£200First flat penalty for a late Company Tax Return

£341Administrative restoration after a strike off

For a founder abroad, four habits prevent it:

1. Diary the first accounts at 21 months from registration.
2. Diary the confirmation statement every 12 months.
3. Keep every letter from HMRC, especially a notice to deliver.
4. Check both tests again whenever money moves.

The summary