Dormant Companies

Key facts

A company is dormant for Companies House purposes if it has had no significant accounting transactions during the period.
For HMRC purposes, a company is dormant if it is not active (not carrying on business or receiving income).
You must notify HMRC that the company is dormant; dormancy is not assumed automatically.
Dormant companies do not need to file a CT600 while dormant, but must still file dormant accounts (form AA02) at Companies House.
If the company starts trading again, you must reactivate it with HMRC within 3 months.

When a Company Counts as Dormant for Tax

The definition of “dormant” differs slightly depending on whether you are dealing with Companies House or HMRC:^[1]

Authority	Definition of Dormant
Companies House	No “significant accounting transactions” during the financial year. Filing fees paid to Companies House and shares issued on incorporation are excluded.
HMRC	Not active — not carrying on a business, not receiving any income (such as rent or interest), and not claiming tax reliefs.

A company can be dormant for Companies House but active for HMRC (for example, if it receives bank interest). Always check both definitions.

Companies House Obligations

Even when dormant, a company must still comply with its basic Companies House obligations:^[3]

File dormant accounts (form AA02) annually — these are simplified balance-sheet-only accounts
File a confirmation statement (formerly annual return) at least once every 12 months
Keep the registered office address up to date
Notify Companies House of any changes to directors or persons with significant control (PSC)

Dormant accounts (AA02) are very simple. They show only the company’s balance sheet (usually just share capital and possibly a small cash balance). There is no profit & loss account, no directors’ report, and no need for an audit.^[3]

Telling HMRC Your Company Is Dormant

HMRC does not automatically know a company is dormant. You must actively notify them:^[2]

Write to HMRC or use the online service to tell them the company is dormant
Provide the date the company became dormant
HMRC will then stop issuing “notices to deliver” CT600 returns

Once HMRC accepts the dormancy notification:

You do not need to file a CT600 while the company remains dormant
You do not need to pay Corporation Tax (there are no profits to tax)
The company is excluded from the associated companies count for other group companies

Tip: If you have not yet registered a newly-incorporated company for Corporation Tax (because it has never traded), you may not need to register at all until it starts trading. A company that has never been active does not need to notify HMRC of dormancy — it simply does not register.^[4]

Reactivating a Dormant Company

If a dormant company starts trading or receiving income again, you must notify HMRC within 3 months of the date it became active.^[4] Once reactivated, the company can file its CT600 returns online with HMRC-recognised software.

In practice, this means:

Register for Corporation Tax online (or re-register if the company was previously active)
HMRC will issue a new “notice to deliver” requiring a CT600
The company must file CT600 returns and pay Corporation Tax from the reactivation date
At Companies House, switch from dormant accounts to full statutory accounts from the next filing date

Common Mistakes

Assuming dormancy is automatic: If you stop trading but don’t tell HMRC, they will keep issuing CT600 notices — and late-filing penalties will follow
Bank interest makes the company active: Even a small amount of interest on a dormant company’s bank account means it is no longer dormant for HMRC purposes
Forgetting Companies House filings: Dormant accounts and confirmation statements are still required — failure to file can lead to the company being struck off
Not checking the associated companies impact: While a dormant company is excluded from the count, an active company that is wrongly treated as dormant is not

Frequently Asked Questions

Does a dormant company need to file a CT600?

No. Once you have notified HMRC that the company is dormant, you do not need to file a CT600 while it remains dormant. However, you must still file dormant accounts at Companies House.

How do I tell HMRC my company is dormant?

You must actively notify HMRC by writing to them or using the online service, stating the date the company became dormant. Dormancy is not assumed automatically — without notification, HMRC will continue issuing CT600 notices.

Does receiving bank interest make my company non-dormant?

Yes. For HMRC purposes, even a small amount of bank interest means the company is receiving income and is therefore active, not dormant. The company would need to file a CT600.

What must I do if a dormant company starts trading again?

You must notify HMRC within 3 months of the company becoming active again. Register (or re-register) for Corporation Tax online, and the company will then need to file CT600 returns and pay Corporation Tax.

Sources

Dormant company — GOV.UK
Tell HMRC your company is dormant — GOV.UK
Running a limited company: annual accounts — GOV.UK
Register for Corporation Tax — GOV.UK