Is My Company Dormant? How to Check

If your company has stopped trading — or never started — you may be wondering whether it qualifies as dormant. The answer affects your filing obligations with both HMRC and Companies House, so it is important to get it right.

This guide explains what dormant means in a UK company context, how to assess your company's status, and what you still need to do even when your company is dormant.

What Does "Dormant" Mean?

A dormant company is broadly one that is not trading and has no income. However, HMRC and Companies House use slightly different definitions — and the two bodies have separate rules about when and how you need to file.

Understanding both definitions will help you work out exactly what obligations you have and whether you need to take any action.

The HMRC Definition of Dormancy

For corporation tax purposes, HMRC considers a company dormant if it:

  • Has no income from any source, including rent, interest, or dividends
  • Has ceased trading and has no ongoing business activity
  • Was recently incorporated but has not yet started trading
Important: HMRC's definition of trading is broad. Receiving rental income from a property, earning interest on a savings account, or paying wages all count as activity that disqualifies a company from HMRC dormancy. A company in any of these situations is not dormant for corporation tax purposes, even if it is not running an active business in the conventional sense.

If HMRC accepts your company as dormant, you will not need to file corporation tax returns for that period. However, you must notify HMRC when the company becomes dormant and again when it starts trading.

The Companies House Definition

For Companies House purposes, your company is dormant if it had no significant transactions during its financial year.

The following are not treated as significant transactions:

  • Companies House filing fees (such as the annual confirmation statement fee)
  • Late filing penalties paid to Companies House
  • Share subscription payments made when the company was originally incorporated
So even if your company paid its annual confirmation statement fee, it can still be classed as dormant by Companies House — provided no other transactions took place.

Can a Company Be Dormant for One and Not the Other?

Yes — and this is a common source of confusion. Consider these examples:

  • A company earning interest on a business bank account is not dormant for HMRC (interest counts as income), but may be dormant for Companies House if that was its only transaction
  • A company that paid a late filing penalty to Companies House is not dormant for Companies House purposes, but could be dormant for HMRC if it had no other activity
Always assess your company's status under each body's definition separately.

A Quick Dormancy Checklist

Work through these questions to assess whether your company is dormant.

For HMRC Dormancy

  • Has the company received any sales income or fees?
  • Has it received any rental income, dividends, or interest?
  • Has it paid any wages or salaries?
  • Is it VAT-registered with any taxable supplies?
  • Has it made any payments for goods or services?
If you answered no to all of these, your company is likely dormant for HMRC purposes.

For Companies House Dormancy

  • Has the company made or received any payments?
  • If yes, were they only Companies House fees or original share subscriptions at incorporation?
If the only transactions were Companies House fees or initial share capital at formation, your company is likely dormant for Companies House purposes.

What You Still Need to File

Dormancy does not remove all obligations. Even a dormant company must:

File with Companies House:

  • An annual confirmation statement — required regardless of trading status
  • Dormant company accounts each year — simplified accounts confirming no significant transactions took place
Dormant accounts are much simpler than full statutory accounts. They typically include only a balance sheet. For a full breakdown, see our guide to dormant company accounts.

Notify HMRC:

  • Tell HMRC your company is dormant so they stop sending corporation tax return notices
  • Respond to any notices received before dormancy is confirmed
  • Notify HMRC again when you restart trading
For guidance on the corporation tax side, read our guide to dormant company CT600 obligations.

How Long Can a Company Stay Dormant?

There is no legal time limit on dormancy. Many companies stay dormant for years — holding companies, companies kept for future use, and companies set up during a period of uncertainty frequently remain dormant for extended periods.

As long as you file your annual confirmation statement and dormant accounts each year with Companies House, and keep HMRC informed of your status, your company can remain dormant indefinitely.

How to Notify HMRC Your Company Is Dormant

If your company was previously active, notify HMRC as follows:

  1. Sign in to your HMRC business tax account via Government Gateway
  2. Navigate to your corporation tax account
  3. Select the option to tell HMRC your company is dormant for corporation tax
You can also write to HMRC's Corporation Tax office, including your company name, Companies House registration number, Unique Taxpayer Reference (UTR), and the date trading ceased.

Once HMRC confirms dormancy, they will stop issuing corporation tax return notices until you start trading again.

Dormant vs Striking Off: Which Is Right for You?

If you have no plans to use the company again, you might consider closing it entirely rather than keeping it dormant. Striking off a company:

  • Removes all ongoing annual filing obligations
  • Is permanent — you cannot reactivate a struck-off company without re-incorporating
  • Requires the company to have not traded in the previous three months with no outstanding assets or debts
Keeping the company dormant is generally the better choice if you might want to use it in future. Restarting a dormant company is significantly simpler than incorporating a new one — you retain the original registration number, history, and any existing bank accounts or contracts.

Reactivating a Dormant Company

When your company starts trading again, notify HMRC within three months of the date it became active. HMRC will open a new accounting period for corporation tax, and you will need to file a company tax return at the end of that period.

Missing this notification can result in missed deadlines and automatic filing penalties on your company tax return, so act promptly when your circumstances change.

Common Mistakes to Avoid

Assuming dormant means no obligations. Companies House still requires annual confirmation statements and dormant accounts regardless of trading status. Failing to file these attracts late filing penalties just as they would for an active company.

Overlooking investment or rental income. Even a small amount of interest on a business bank account technically disqualifies a company from HMRC dormancy. Check your bank statements carefully before claiming dormant status.

Not notifying HMRC promptly. If you wait, HMRC continues sending corporation tax return notices. Failing to respond to those — even when genuinely dormant — can result in penalties for missing a return.

Mixing up the two definitions. Being dormant for Companies House does not automatically mean dormant for HMRC. Check each separately, as the consequences of getting it wrong are different for each authority.

Summary

A dormant company is one that is not trading and has no income, but HMRC and Companies House apply slightly different tests. Use the checklists above to assess your company's status under both frameworks. Even when dormant, you must file annual confirmation statements and dormant accounts with Companies House and notify HMRC of your status. When you restart trading, inform HMRC within three months to avoid missing your first filing deadline.