Closing a Limited Company Without an Accountant
Hi everyone,
About a year ago, I launched an ambitious limited company with the goal of breaking away from my IT job and pursuing my own venture. Unfortunately, due to personal commitments, I’ve decided to close it down. While I invested money to get the company started, I haven’t made any profits. I’ve filed a confirmation statement once but never submitted any accounts.
To dissolve the company, I know I need to apply for a strike-off using the government DS01 form and file my final accounts. However, I’m feeling a bit lost when it comes to preparing the accounts and where to enter the information. Ideally, I want to handle this myself without incurring any costs aside from the strike-off fee.
Do I need to file accounts with both Companies House and HMRC, or just HMRC? How should I go about doing this?
Here’s a breakdown of my finances:
- Total amount invested in the company: £4,940
- Total expenses on equipment, insurance, etc.: £4,927.46 (of which £2,054.51 were physical assets)
- Revenue from one completed job: £350 (withdrawn as repayment of my initial investment)
- Remaining balance withdrawn from the company account: £12.54 (also a repayment of my initial investment)
This is how it breaks down:
| What? | Amount | Direction (In/Out of Company) |
|—————————————-|————-|——————————-|
| Initial investment | £4,940 | In |
| Expenses (insurance, etc.) | (£2,842.95)| Out |
| Assets (equipment, etc.) | (£2,084.51)| Out |
| Revenue from job | £350 | In |
| Withdrawal for repayment of investment | (£362.54) | Out |
| TOTALS | £0 | |
Any guidance on where to allocate these amounts and how to make sure HMRC is aware these are my final filings would be incredibly helpful.
I’ve reached this page, but I’m unsure about what goes where: Link
Thank you in advance for your help!
2 Comments
Closing down a limited company can seem complicated, especially without the guidance of an accountant, but it’s definitely manageable on your own. Here’s a straightforward breakdown of your situation and what you need to do:
1. Filing Final Accounts
Since you’ve not filed any accounts before, this will be your first and final set of accounts. You will need to prepare:
Profit & Loss Account
You should summarize your income and expenses. For your case, it will look like this:
Income:
– Job Payment: £350
Expenses:
– Insurance and other expenses: £2,842.95
– Equipment: £2,084.51
Net Profit/Loss:
– Total Income: £350
– Total Expenses: £4,927.46
– Loss: £4,577.46 (This will be indicated as a negative figure in the accounts)
Balance Sheet
Your balance sheet will summarize the assets and liabilities:
Assets:
– Physical Assets (Equipment, etc.): £2,054.51
Liabilities:
– Bank Account: £0 (after your withdrawals are accounted)
Equity:
– Shareholder funds (initial investment): £4,940
– Loss carried forward: £4,577.46
Total Assets = Total Liabilities + Equity
– This should balance out, showing that your assets minus your liabilities equal your shareholder funds.
2. Filing with Companies House and HMRC
Companies House: You will need to file your final accounts with Companies House when you apply for the strike off using the DS01 form. You can submit these online or by post. There may be additional guidance available on the Companies House website.
HMRC: You’re required to inform HMRC regarding your company’s cessation of trading. You may have to submit your final Corporation Tax return (CT600) along with your accounts, even if there’s no corporation tax payable (due to the loss).
3. Applying for Strike Off
Once your accounts are prepared, you can fill out and submit the DS01 form online or via post. You will need to pay a strike-off fee (currently £10). Ensure you check the declared information on the form is accurate.
4. Informing HMRC
Don’t forget to notify HMRC that the company is closing. This can be done via writing to them or through their online portal, indicating that your company will not be continuing, which may direct them to your final accounts.
Summary
Since this involves potential nuances, especially with HMRC requirements, consider any further resources or guides directly from Companies House or HMRC’s official sites to ensure compliance. Good luck with your closure process!
Hi there,
It’s great that you’re taking a proactive approach to closing your limited company! From your breakdown, it looks like you’ve kept good records, which will definitely help as you prepare your final accounts.
To answer your question, you will indeed need to file accounts with both Companies House and HMRC. Since your company was dormant for most of its existence, your filings may be simpler than expected. For Companies House, you generally only need to submit a “dormant accounts” filing if you have had no significant transactions. Given your minimal revenue, you might qualify.
For HMRC, you will need to submit a final Corporation Tax return (CT600). However, since you have no profits to report, you won’t owe any tax, but it’s important to file regardless. In your case, you would indicate in the return that your company is ceasing to trade.
Here are a few steps you might find helpful:
1. **Prepare Your Final Accounts**: Since your balance is essentially zero, you can prepare simplified accounts that reflect this. Focus on summarizing the transactions you mentioned, indicating your total investment, expenses, and the revenue from the job.
2. **File with Companies House**: Complete the DS01 form for the strike-off and include the dormant accounts. This can usually be done online, and you’ll pay the strike-off fee at that time.
3. **Notify HMRC**: You will also need to notify HMRC that you’re ceasing trading. This