Costs for closing a company in this way start from about £1,500 plus vat upwards. If there are no assets or liabilities then a company that is dormant can just be struck off for a fee of £10 paid to Companies House on completion of form DS01 (obtainable online from Companies House).
You can close down your limited company by getting it 'struck off' the Companies Register, but only if it:
- hasn't traded or sold off any stock in the last 3 months.
- hasn't changed names in the last 3 months.
- isn't threatened with liquidation.
- has no agreements with creditors, eg a Company Voluntary Arrangement ( CVA )
Simply put, limited liability is a layer of protection placed between the company and its individual directors. This means the directors cannot be held personally responsible if the company is unable to pay its debts.
Who to sue? Limited companies are, of course, legal entities in their own right, so you will need to sue the business, not the directors or any other individuals working in the business. The only exception to this will be if you have asked for and been given personal guarantees, normally by the directors.
4.2 However, as mentioned above, a director can become personally liable under Indian laws, in certain circumstances such as where the liability is stated to be unlimited in the company's organizational documents; or the director is found guilty of fraud or misrepresentation; or has personally assured, indemnified or
To apply to strike off your limited company, you must send Companies House form DS01. The form must be signed by a majority of the company's directors. You should deal with any of the assets of the company before applying, eg close any bank accounts and transfer any domain names.
A limited company is completely separate. Therefore, entering liquidation will not appear on your personal credit file. However, a defaulted personal guarantee will mark against your report.
If a dissolved company can be restored to the Register, the Crown Solicitor as nominee and with the approval of the Treasury Solicitor may make a discretionary payment from its assets to the former shareholders, liquidators, administrators or company voluntary arrangement (CVA) supervisors.
Safeguarding Company Assets After Closure. When a company is dissolved as part of the liquidation process, the business is closed permanently. Therefore, the company assets and liabilities are dealt with, and the organisation is removed from the register at Companies House.
Liquidate means a formal closing down by a liquidator when there are still assets and liabilities to be dealt with. Dissolving a company is where the business is struck off the register at Companies House because it is now inactive.
You may be able to claim money back or buy assets from the dissolved company by:
- getting a court order to restore the company - if they owe you money.
- buying or claiming some of their assets - if you're affected by the company closing.
- applying for a discretionary grant - if you were a shareholder.
You usually need to have
the agreement of
your company's directors and shareholders to
close a
limited company.
The way you
close the company depends
on whether it can pay its bills or not.
You can let it become 'dormant' for tax as long as it's not:
- carrying on business activity.
- trading.
- receiving income.
As long as you did not act outside of the law whilst in your post as director, you are free to walk away from the company for good.
It takes a minimum of three months from the time of application to dissolution - this is the time in which creditors can object. Depending on the structure and complexity of your business, however, the process can take a great deal longer.
