Closing a company after 14 months - that I didn't use at all

[dowjones123]

I incorporated a company 14 months back, that I didn't use at all.

No income absolutely, some small expenses of less than 500 pounds in all from its bank account/credit card account. I want to close down the company (I found out about DS01 form and filled it up, but before submitting checked with my accountant of the other contracting company I have)

The accountant tells me that since its been in existence over 1 year, HMRC might object to it being closed down without filing accounts. And she will change GBP 200 for it

Since there are basically no income and minimal expense, so essentially a loss, is there a way for me to do it on my own ?

Thanks much

[Clare@InTouch]

£200 sounds cheap.

If you want to do it yourself though you can prepare a simple set of accounts and CT return - you will need to file with HMRC via iXbrl software, or using their online Gateway. Once HMRC have processed them and show the CT account at zero you can then submit the DS01.

You should be able to do one set of accounts for the whole 14 month period, rather then two sets.

[Martin at NixonWilliams]

I agree with Clare - It is an unfortunate position to be in really and I can see why it might seem expensive but the reason for this is because a lot of the work (accounts, CT return etc) is the same whether the company has done hardly anything or if it has been active for the full year.

[dowjones123]

£200 sounds cheap.

If you want to do it yourself though you can prepare a simple set of accounts and CT return - you will need to file with HMRC via iXbrl software, or using their online Gateway. Once HMRC have processed them and show the CT account at zero you can then submit the DS01.

You should be able to do one set of accounts for the whole 14 month period, rather then two sets.

Thanks much for the reply.

The transactions I had in my bank account are:

+GBP 100 on 1st day (1 Nov 2013)- for 1000 ordinary shares of GBP 0.1 each
-GBP 60 in 3 transactions for expenses over the next year, no income at all since start of company

I closed the bank account already by taking out the GBP 40 to my own account


I log into Companieshouse.gov.uk, and it has a link to "File Company Account"
I go there - I think there are 5 options:

1. Abbreviated accounts
2. Dormant Accounts
3. Micro-entity accounts
4. Full accounts with abbreviated options
5. Full accounts

Which one should I go for - Dormant accounts or Micro-entity accounts? I think I qualify for both

For both options, the Date of Balance Sheet/For the Year Ending is set to 31 Oct 2013. Do you recommend changing this to 30 April 2014?

Also, if I understand you correctly, I also need to go to HMRC site and file for a Profit and Loss? I see that nowhere CompaniesHouse.gov.uk asks me for PnL, but just the balance sheet at Year Ending.

Thanks much for the answer again.

[Clare@InTouch]

You're not dormant, that would only apply if there are no transactions at all.

You need to create a set of accounts first, both a Profit & Loss and a Balance Sheet. Companies House will then allow you to file Abbreviated Accounts, which is just the Balance Sheet and notes. The accounts then also need to be filed at HMRC.

You will need to change your year end first, which you can do online.

Your accounts should show a simple loss of £60 on the P&L, and then a Balance Sheet of:

Cash -59
= -59

Shares £1
P&L £-60
= -59

[TheFaQQer]

I closed the bank account already by taking out the GBP 40 to my own account

Salary, dividend or directors loan?

What paperwork did you complete when you took the company money?

[Boney M]

Surely Companies house will strike it off anyway for not filing and HMRC will probably have no objections on CT.

[TheCyclingProgrammer]

Salary, dividend or directors loan?

What paperwork did you complete when you took the company money?

Does it matter for £40? It can be treated as a directors loan which is cleared by the distribution of the capital on winding up, surely?

[TheFaQQer]

Does it matter for £40? It can be treated as a directors loan which is cleared by the distribution of the capital on winding up, surely?

As long as it's correctly accounted for, then there is no difference. However, if there is nothing which indicates what happened to the money, that doesn't seem right to me.

[TheCyclingProgrammer]

As long as it's correctly accounted for, then there is no difference. However, if there is nothing which indicates what happened to the money, that doesn't seem right to me.

I think its reasonable to assume that in the absence of payroll or the correct dividend paperwork, that any other drawings are treated as a director's loan.