020 7129 8651

Dormant Companies: Can I Save My Name for the Future?

As your business gets off the ground and your reputation grows your business’ name becomes one of your most valuable assets.

CO-WORKING SPACES

A dormant company is one that is not trading and has no accounting transactions, but when you form a dormant company it means that no-one else can form a limited company with the same name. That’s why, even if you don’t intend to trade as a company right now, dormant company ownership can be a useful way of safeguarding the interests of your business.

Here we look at how this works in practice. We cover what’s involved in maintaining a dormant company, with a view to protecting your business identity. We’ll also consider what happens when a dormant company becomes active and what this means for your business’ name.

 

How can a dormant company ownership help to safeguard my business name?

For one, you may be trading (or intend to trade) under your own name and forming as dormant beneath it will help to safeguard it. Alternatively, you may have opted for a title that’s not connected directly with your personal identity, but perhaps refers to your product or brand. Either way, a well-thought-out name will set you apart from the crowd and avoid any confusion in the minds of customers.

Even if you intend to stay as a sole trader for the time being registering a company with the same name as your business prevents an identical name being registered by anyone else. Here’s why you might consider it:

  • It can help to warn off would-be imitators – and by doing so, can help prevent costly disputes further down the line.
  • It’s easy to set up via a speedy and efficient online process, without having to get accountants or solicitors involved.
  • The admin and costs involved in keeping a dormant company going are modest. Each year you are required to file an annual return. Companies House provides a streamlined form for dormant companies that have never traded and the online filing fee is £13. You are also required to submit dormant company accounts. This can be done online, free of charge and as there are no transactions to log it’s a straightforward process.
  • Providing you continue to meet your filing obligations the company can remain dormant and other people can be stopped from registering that company name indefinitely.

 

What happens when I want to activate the dormant company?

When you feel the time is right to start operating your business under your dormant company you are required to take the following steps:

  • Within 3 months of the company carrying on any kind of business activity, you must notify HMRC.
  • Send your account to Companies House within nine months of your company’s year-end.
  • Within 9 months and 1 day of your company’s year-end, you need to pay any Corporation Tax due.
  • Within 12 months of your company’s year-end, you need to send a Company Tax Return. This includes your statutory accounts, to HMRC.

You will have been sending accounts to Companies House each year while your company was dormant. Once you switch from dormant to active, the reporting dates for your annual returns and accounts will remain as they were. That is, they will not change. The change of your company’s status will be made known to Companies House when they see your annual accounts. As such, there is no need to contact Companies House specifically to notify them once you switch your company’s status from dormant to active.

 

Using ‘Limited’ or ‘Ltd’

So far as your name is concerned you are required to make it clear that your business is now operating as a limited company. This applies to all stationery and promotional material such as letters, order forms invoices and your company’s website.

The ‘Limited’ or ‘Ltd’ assignation needs to be clear. Let’s say your business is ‘[Your Name] IT Solutions’. To protect that business name you registered a company in the name of ‘[Your Name] IT Solutions’. Once you start using the company to trade under you need to make it clear that the full and proper name of your business is now ‘[Your Name] IT Solutions Limited’.

So, does that mean that you have to change your logo? As well as each and every reference to your name on your website? Not necessarily. Take your letters and invoices, for instance. You can leave your logo as it is provided that elsewhere, on the same document, your company’s full name is given. You are also required to show your company’s registered number, the registered office address and where the company is registered. And if you list one director, you must list them all.

On your website, your ‘About Us’ and ‘Contact’ pages will need amending. It’s best practice to include full company information at the bottom of each page.

Unless your business is run from home you must also display a sign showing your full company name at your registered address and at whatever premises your business operates.

 

Maintain your identity: even when your business structure changes

Owning a dormant company can allow you to switch seamlessly to trading as a company when the time’s right, without having to re-brand your business.

Care should be taken to keep on top of your filing requirements whilst the company is dormant. As well as financial penalties, failure here can result in the company being struck off the register.  Whilst it’s possible to restore a dissolved company it’s much less straightforward than merely switching from dormant to active. Fortunately though, with online filing maintaining a dormant company need not be a hassle.

Register your own business from £9.99

Our simple process

find a name searchbar icon

Find a name for
your company

arrow right
small green arrowing pointing right
bundles icon

Choose the bundle that's right for you

arrow right
small green arrowing pointing right
purchase bundle icon

Purchase your
bundle online

arrow right
small green arrowing pointing right
we will do the rest icon

Fill in a few details and we'll do the rest

Why pick us?

Easy-going experts graphic

Easy-going experts

We'll answer any questions you have and explain anything you're unsure of.

Simple, honest pricing

Starting a business can be expensive. Which is why all our bundles are affordable for everyone.

Simple honest pricing graphic
Friendly after sales support graphic

Friendly after sales support

Wondering what to do next? Our after care team can help you with the next steps.

Why pick us?

Easy-going experts

We'll answer any questions you have and explain anything you're unsure of.

Simple, honest pricing

Starting a business can be expensive. Which is why all our bundles are affordable for everyone.

Friendly after sales support

Wondering what to do next? Our after care team can help you with the next steps.

What our customers think

feefo logo
yellow star rating

Rated 4.6 out of 5

Trustpilot logo
green star rating

Rated 4.0 out of 5

facebook logo
blue star rating

Rated 4.4 out of 5

google logo
yellow star rating

Rated 4.2 out of 5

 

 

Formation bundles

 

 

e-formation formation icon
  • £9.99
  • E-Formation

  • Set up a basic Limited Company that’s ready to trade and choose anything else you need as extra.
north east south west location pin icon
  • £19.99
  • Essential

  • An easy way to set up a company that’s ready to trade. Plus, your official printed certificates.
entrepreneur formation icon
  • £59.99
  • Entrepreneur

  • Your official certificates & company register. Plus, a registered business address, FREE for 3 months.
super formation icon
  • £149.99
  • Super

  • Your official documents, and confirmation statement. Plus, a registered business address, FREE for a year.

Knowledge hub

Don’t be afraid to start a new business

Shonna Green and Shervin Campbell are the founders of CamPhoto, a photography business specialising in PR, corporate, awards and graduation ceremonies and sports and social events. Childhood...

Read More
Ready to have your company set up?
Registering a company might seem an intimidating process, but it’s actually much simpler than you think: especially in the hands of seasoned company formation agents like us. We’ll not only help you with registering a company, but offer a range of services to support your business at all stages of its life. We’ll help you sort out your company registrations online, with a process so quick and easy you can go ahead and focus on the fun bits.
What is a company formation agent?

Formation agents perform company registrations in partnership with Companies House. We’re one of the largest, and also the cheapest. We don’t just get your company registered then leave you to it – we use our experience to help you start your business properly. There are plenty of reasons to use a formation agent rather than go directly to Companies House. If you ask us, though, the best thing is that we go through the whole process with you, and get your application submitted securely online. We provide expert advice on the legal hurdles while you incorporate, and recommend good quality solutions that you might need after you’ve formed.

What’s the difference between sole trader and limited company?

Think of it this way: when you form a limited company, you put a protective shield between you and your business. Being a sole trader is the opposite – you have no protection. As a sole trader, you are responsible for any debt you might come into while you’re in business. When you register and become the director of your own limited company, you have less personal responsibility. The benefits are that you can claim back expenses, and add to your salary with dividend payments at the end of the year. For more information, see our Help Centre article about limited companies and sole traders.

How do I register a company?

Easy, we’ll do it for you. Check out our formation bundles to learn more about our different products. They start at £9.99, and go all the way up to our Super bundle. Limited company formation is a straightforward business if you’re as well-versed with the process as we are. If you’re not sure where to start, check out our company formation guides for an introduction and some insider tips.

Why The Formations Company?

We’re dedicated to British business, and love nothing more than seeing new companies flourish. 750,000 UK companies have trusted us to help them register, and we have thousands of happy customers who’ve seen how simple the formations process can be. We’re cheaper than going to Companies House directly, and cost less than most accountants. Our online application is incredibly simple, and if you’ve got all your documents handy it shouldn’t take more than 10 minutes to complete. So what are you waiting for? Start your business today.

Learn more about starting a business

Sign up to our newsletter