Want to press pause on your company without shutting it down for good?
You’re in the right place.
This guide walks you through exactly how to make a company dormant in the UK. Whether you’re pausing operations, saving tax, or prepping for future growth, you’ll learn the right steps to take (and what to avoid).
Let’s dive in.
What Is a Dormant Company?
Before we go further, here’s a quick definition:
A dormant company is a business that’s registered with Companies House but isn’t actively trading or carrying out any income-generating activity.
No buying or selling
No earning income
No business-related expenses (with a few exceptions)
Why does this matter?
Because making your company dormant can save you time, money, and paperwork without the need to close your business completely.
Why Make a Company Dormant?
Here are the top reasons why UK business owners go dormant:
- Reduce accounting and tax duties
- Pause operations temporarily
- Protect your business name/brand
- Prep for future projects
- Avoid closing and reopening the company
Now let’s go over how to actually make your company dormant the right way.
Step 1: Stop All Trading Activities
This one’s obvious but important.
To make your company dormant, you need to stop all forms of business activity. That means:
- No buying or selling
- No issuing invoices
No earning interest or dividends - No paying salaries or making business payments
You can still pay fees like Companies House filing fees or bank charges these won’t affect your dormant status.
Step 2: Tell HMRC Your Company Is Dormant
Now it’s time to let HMRC know.
Here’s how to do it:
If your company has never traded:
You don’t need to inform HMRC manually. They’ll usually mark your company as dormant automatically.
If your company has traded before:
You need to contact HMRC and let them know your company is no longer active.
You can do this by:
- Writing a letter to your local Corporation Tax office
Using your HMRC online account (if available) - Calling HMRC’s Corporation Tax helpline
Once confirmed, HMRC won’t expect company tax returns — unless your company becomes active again.
Step 3: Submit Dormant Company Accounts to Companies House
Even dormant companies have legal filing duties.
You must still submit dormant accounts to Companies House every year. These are much simpler than regular accounts.
Here’s what you’ll need:
- A balance sheet showing no trading activity
- A statement confirming your company is dormant
You can file online via your Companies House account or use your accountant.
Filing deadlines still apply usually 9 months after your company’s financial year end.
Step 4: Maintain a Registered Office and Director
Even though your company is dormant, you still need to keep your:
- A registered director (at least one)
- A registered office address
- Confirmation Statement (filed yearly)
Think of it like keeping your business paperwork in order, even while it’s asleep.
Step 5: Pause Your Business Bank Account (Optional but Smart)
If your business account is still active, small charges or transactions could trigger trading activity.
To stay compliant:
- Freeze or close the business account
- Avoid paying or receiving any funds through it
This helps prevent issues with HMRC or Companies House.
How to Reactivate a Dormant Company
Want to wake your company up?
Easy.
Just start trading again then notify HMRC that your company is active. You’ll need to:
- Register for Corporation Tax
- Submit tax returns
- File full accounts if trading resumes
You’re back in business.
Conclusion
Making your company dormant is simple but strategic.
It helps you stay compliant, save money, and keep your options open whether you’re pausing operations, planning a pivot, or protecting your brand.
Here’s a quick recap of the steps:
- Stop all trading activity
- Inform HMRC (if previously trading)
- File dormant accounts to Companies House
- Maintain a director and registered address
- Pause your business bank account
Want to future-proof your business? Going dormant is a smart move.
