HMRC Corporation Tax - Your Company Status

What the notice is about?

This is a reminder notice from HMRC to check upon the trading status of a dormant company in order to confirm the state of company’s activities, start filing regular accounts & compute taxes thereby, if needed.

What is a dormant company?

Your company is usually dormant for Corporation Tax if it:

  • has stopped trading and has no other income, for example income from investments
  • is a new limited company that hasn't started trading
  • is an unincorporated association or club owing less than £100 corporation tax
  • is a flat management company

Who needs to action it?

  • Any newly incorporated company who hasn't started its trading activities or
  • a company who has stopped trading or
  • Acquired status of dormant company needs to evaluate at each reporting period.

What to do next?

All dormant companies need to provide information to the HRMC regarding the trading status of the company, within 3 months of change in its status to trade.

Are there still any compliance requirements for dormant companies which have not started to trade?

It is mandatory for dormant companies also to file confirmation statement and annual accounts to Companies House. Also, they need to inform HMRC either by call or post about their status of dormancy to let them know that they should not expect a corporation tax return from the company, failing which they would be penalised for late filings in absence of information.

HMRC Corporation Tax – Your Company Status | Debitam

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