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Has Your LTD Company Had No Activity This Year? You Still Need to File Documents!

Complete guide for UK Limited Companies: dormant accounts, Confirmation Statement, HMRC, VAT, PAYE, CIS and the option to close the company

Many UK Limited Company directors make the same mistake:

“My company had no activity this year, so I do not need to file anything.”

Unfortunately, this assumption can become expensive.

A Limited Company registered with Companies House remains an active legal entity until it is officially closed. The fact that you did not issue invoices, had no clients or received no money does not automatically mean that you have no obligations.

Even a company with no activity may still have obligations towards:

  • Companies House;

  • HMRC;

  • VAT, if the company is VAT registered;

  • PAYE, if there is an active payroll scheme;

  • CIS, if the company is registered as a contractor;

  • directors, shareholders and PSC records;

  • internal accounting records.

This article explains exactly what needs to be done when your LTD company has had no activity, what documents must be filed, what penalties you may receive and what options you have: keeping the company dormant, reactivating it or closing it correctly through strike off.

Executive Summary

If your LTD company has had no activity, do not assume that you have nothing to do.

In most cases, you may still need to file or deal with:

  • Dormant Accounts or the appropriate accounts with Companies House;

  • the annual Confirmation Statement;

  • notification to HMRC that the company is dormant for Corporation Tax;

  • possibly a CT600, if HMRC has issued a Notice to Deliver or the company was active for part of the year;

  • nil VAT Returns, if the company is VAT registered;

  • EPS / payroll submissions, if the company has an active PAYE scheme;

  • CIS nil returns or an inactivity request, if the company is a CIS contractor;

  • updates to directors, PSCs, registered office, registered email address and identity verification.

Penalties can arise even if the company had no profit, no sales or no money in the bank.

The practical rule is simple:

A company with no activity is not a company with no obligations.

1. What Does “The Company Had No Activity” Actually Mean?

In everyday language, a director may say that the company “had no activity” when:

  • it did not issue invoices;

  • it had no clients;

  • it received no money;

  • it made no sales;

  • it had no subcontractors;

  • it paid no salaries;

  • it did not actually carry out business.

However, from an accounting and tax perspective, things are more nuanced.

A company may have had no sales, but may still have had transactions such as:

  • bank charges;

  • software subscriptions;

  • insurance;

  • payments to an accountant;

  • registered office fees;

  • website/domain costs;

  • business phone costs;

  • advertising;

  • tools/equipment;

  • director loan transactions;

  • VAT refund;

  • HMRC repayment;

  • interest received;

  • payment to Companies House;

  • payroll submissions;

  • dividends;

  • transfers between the director and the company.

This is the critical difference:

“I had no sales” does not automatically mean “the company is dormant.”

To decide what needs to be filed, you must check whether the company is:

  • dormant for Companies House;

  • dormant for Corporation Tax;

  • non-trading, but with transactions;

  • active for only part of the year;

  • still registered for VAT/PAYE/CIS;

  • ready for closure.

2. Two Different Institutions: Companies House vs HMRC

One of the biggest sources of confusion is that directors often treat Companies House and HMRC as if they were the same organisation.

They are not.

Companies House

Companies House deals with the legal existence of the company.

This includes:

  • annual accounts;

  • dormant accounts;

  • confirmation statement;

  • director details;

  • shareholder details;

  • PSC details;

  • registered office;

  • registered email address;

  • identity verification;

  • the company’s status on the public register.

Companies House wants to know whether the company exists, who controls it and whether the official information is up to date.

HMRC

HMRC deals with taxes.

This includes:

  • Corporation Tax;

  • CT600;

  • VAT;

  • PAYE;

  • CIS;

  • payroll taxes;

  • tax repayments;

  • penalties;

  • interest;

  • tax compliance.

HMRC wants to know whether the company had profit, income, tax liabilities or tax reporting obligations.

This is why situations can arise where:

  • the company is dormant for HMRC, but still has to file documents with Companies House;

  • the company is dormant at Companies House, but HMRC is still expecting a CT600;

  • the company had no sales, but is VAT registered and must file nil VAT Returns;

  • the company paid no salaries, but the PAYE scheme is active and HMRC must be notified;

  • the company paid no subcontractors, but the CIS contractor scheme must be managed correctly.

3. What Does Dormant Mean for Companies House?

For Companies House, a company is dormant if it has had no “significant accounting transactions” during the financial year.

Significant transactions are generally real company transactions, such as sales, expenses, payments, receipts, bank charges, subscriptions, salaries or purchases.

However, there are a few transactions which, under Companies House rules, are not treated as significant transactions:

  • payment for shares at the time of incorporation;

  • Companies House filing fees;

  • penalties for late filing of accounts.

If the company qualifies as dormant and is small, it may file dormant accounts with Companies House.

These are simpler than normal accounts.

But be careful:

Dormant accounts do not mean that you file nothing. They mean that you file a simplified set of accounts.

4. What Does Dormant Mean for HMRC Corporation Tax?

For HMRC, a company may be dormant for Corporation Tax if:

  • it is not carrying on trading activity;

  • it has no income;

  • it has no taxable profits;

  • it does not receive interest or other income;

  • it has no activity that creates Corporation Tax obligations.

If the company has stopped trading or has never started trading, HMRC must be notified that the company is dormant for Corporation Tax.

After HMRC accepts the dormancy status, the company normally does not need to file a Company Tax Return, unless:

  • HMRC specifically asks for a Company Tax Return;

  • the company starts trading again;

  • income or taxable activity arises;

  • other active tax obligations exist.

Very important:

If HMRC has already issued a Notice to Deliver a Company Tax Return, do not ignore it. In some cases, even if the company had no profit, a nil CT600 may be required or HMRC may need to be contacted for clarification.

5. Documents That Still Need to Be Filed Even If the Company Had No Activity

5.1 Annual Accounts or Dormant Accounts with Companies House

All Limited Companies must file accounts with Companies House.

If the company was completely dormant under Companies House rules, dormant accounts may be filed.

If the company had no sales, but had expenses or transactions, it may not be able to file dormant accounts and may need micro-entity accounts or small company accounts, depending on the situation.

Example:

The company had no clients, but paid:

  • £120 for a website;

  • £300 accountant fee;

  • £15 bank charges;

  • £50 software subscription.

In everyday language, the director says: “The company did not work.”

From an accounting perspective, the company had transactions.

In this case, it must be assessed whether dormant accounts are appropriate or whether normal accounts are required, even if the result is zero profit or a loss.

5.2 Confirmation Statement

The Confirmation Statement is not the same as accounts.

It is an annual document through which you confirm that the company’s information is correct.

You must check and confirm:

  • registered office address;

  • registered email address;

  • directors;

  • secretary, if applicable;

  • shareholders;

  • share capital;

  • SIC codes;

  • PSCs;

  • lawful purpose statement;

  • identity verification status, where applicable.

The Confirmation Statement must be filed even if:

  • the company had no activity;

  • nothing changed;

  • the company is dormant;

  • the company has no money in the bank;

  • the director has left the UK;

  • the company is no longer being used.

The practical rule is:

If the company still exists at Companies House, the Confirmation Statement must be filed.

5.3 HMRC Corporation Tax

If the company has not started trading, HMRC must be notified that the company is dormant.

If the company traded in the past and then stopped, HMRC must be notified of the date from which the company became dormant.

If the company was active for part of the year, it may need:

  • accounts for that period;

  • CT600 for the active period;

  • then dormancy notification for the following period.

Example:

The company worked from April to June, then had no further activity.

You cannot automatically treat the whole year as dormant.

Accounts must be prepared for the year, including the April-June activity, and HMRC can then be notified that the company became dormant from the date activity stopped.

5.4 VAT Returns

If the company is VAT registered, the absence of activity does not remove the obligation to file a VAT Return.

If the company had no sales and has no VAT to reclaim, a nil VAT Return may still be required.

If the company no longer needs VAT registration, VAT deregistration should be considered.

Example:

The company is VAT registered, but had no sales in the latest quarter.

This does not mean the VAT Return can be ignored.

A nil VAT Return or a correct VAT Return must be filed, depending on the transactions.

Important:

Failure to file VAT Returns can lead to penalties, interest and problems with HMRC, even if the figures are zero.

5.5 PAYE

If the company has an active PAYE scheme but has not paid salaries, you must check what HMRC expects.

In some cases, an EPS must be submitted for “no payment due”.

If the company will no longer run payroll, it may be appropriate to close the PAYE scheme through a final submission.

Example:

The director had payroll in previous years, but took no salary this year.

If the PAYE scheme is still active, HMRC may still expect payroll submissions.

The solution may be:

  • EPS no payment;

  • final payroll submission;

  • closing the PAYE scheme;

  • checking liabilities.

Do not assume that PAYE closes automatically just because no salary was paid.

5.6 CIS

If the company is registered as a CIS contractor and has not paid subcontractors, the CIS obligation must be managed.

Depending on the situation, you may need:

  • monthly nil CIS returns;

  • inactivity request;

  • closing the CIS contractor scheme if no longer required;

  • checking penalties if previous months were not filed.

Example:

The company used subcontractors last year, but had no jobs this year.

If the CIS contractor scheme remains active, HMRC may still expect monthly returns or an inactivity notification.

This is an area where many companies receive unnecessary penalties.

6. Practical Examples

Example 1: Company Incorporated but Never Used

Maria incorporated an LTD in January 2025, but did not open a business bank account, did not issue invoices, had no expenses and did not start trading.

What needs to be done?

  • file dormant accounts with Companies House;

  • file the Confirmation Statement;

  • notify HMRC that the company is dormant for Corporation Tax;

  • keep the company details up to date;

  • check identity verification for the director/PSC, where applicable.

What should not be done?

  • ignore letters from Companies House;

  • ignore letters from HMRC;

  • assume the company will “close by itself”;

  • leave the Confirmation Statement unfiled.

Example 2: The Company Traded for 3 Months, Then Stopped

Ion worked through his LTD from April to June. He issued invoices of £18,000 and had expenses of £4,000. From July, there was no further activity.

What needs to be done?

  • accounts for the financial year, including income and expenses;

  • CT600 for the active period;

  • Corporation Tax calculation, if there is profit;

  • notification to HMRC that the company became dormant after activity stopped;

  • Confirmation Statement with Companies House;

  • VAT/PAYE/CIS check if any schemes are active.

It is not correct to file dormant accounts for the whole year if the company had activity at the beginning of the period.

Example 3: The Company Had No Sales, but Had Expenses

Andrei had no clients this year, but the company paid for:

  • website;

  • accounting fee;

  • business insurance;

  • bank charges;

  • software.

What needs to be done?

  • analyse the transactions;

  • prepare the appropriate accounts;

  • do not automatically assume the company is dormant for Companies House;

  • if HMRC is expecting a CT600, file the correct return or clarify dormancy.

This is a very common situation.

The director says: “The company did not work.”

The accountant says: “The company had no sales, but it had transactions.”

The difference matters.

Example 4: The Company Is VAT Registered but Had No Activity

The company is VAT registered, but this year it had no sales and made no purchases.

What needs to be done?

  • file nil VAT Returns for the relevant periods;

  • consider VAT deregistration if the company will no longer trade;

  • check whether there are VAT repayments or liabilities;

  • keep records.

Important:

VAT registration comes with obligations until it is officially cancelled.

Example 5: The Company Is No Longer Needed

Daniel opened an LTD for a contract, but the contract never started. He does not want to use the company in the future.

Options:

  • keep the company dormant and file annual dormant accounts + confirmation statement;

  • close the company through voluntary strike off;

  • check whether there is a bank account, assets, liabilities, HMRC registrations, VAT/PAYE/CIS;

  • close tax obligations before strike off.

If the company will no longer be used, sometimes the cleanest solution is official closure.

However, strike off should not be applied for before checking whether the company has debts, assets, tax obligations or outstanding HMRC returns.

7. Penalties: Why “No Activity” Is Not Enough of an Excuse

7.1 Companies House Accounts Penalties

If accounts are filed late with Companies House, the penalties for a private limited company can be:

  • up to 1 month late: £150;

  • between 1 and 3 months: £375;

  • between 3 and 6 months: £750;

  • more than 6 months: £1,500.

If accounts are filed late two years in a row, the penalties may double.

Important:

Penalties can arise even if the company is dormant.

7.2 Confirmation Statement

If you do not file the Confirmation Statement:

  • the company may receive a penalty;

  • Companies House may start strike off action;

  • the company may be dissolved;

  • directors may lose control of the situation;

  • banks or contractors may view the company as non-compliant.

The Confirmation Statement is an annual obligation separate from accounts.

7.3 HMRC Company Tax Return Penalties

If HMRC asks for a Company Tax Return and it is not filed on time, penalties may arise.

HMRC penalties for a Company Tax Return may include:

  • penalty after 1 day late;

  • additional penalty after 3 months;

  • tax determination if the return is very late;

  • percentage-based penalties linked to tax;

  • increased penalties for repeated late filing.

Even if the company has no tax to pay, do not ignore a Notice to Deliver.

The solution is to clarify the position with HMRC or file the correct return.

7.4 VAT, PAYE and CIS Penalties

If the company is registered for VAT, PAYE or CIS, obligations may still exist even during periods with no activity.

Examples:

  • VAT registered: nil VAT Returns;

  • PAYE active: EPS no payment or closing the scheme;

  • CIS contractor: nil return or inactivity request.

Ignoring these schemes can lead to unnecessary penalties.

8. What Should You Do If Your Company Had No Activity?

Step 1: Check Exactly What Transactions Took Place

Do not start from the assumption “there was no activity”.

Start from the records.

Check:

  • bank statements;

  • business account;

  • personal payments made for the company;

  • HMRC letters;

  • Companies House register;

  • VAT account;

  • PAYE account;

  • CIS account;

  • software subscriptions;

  • invoices;

  • receipts;

  • director loan movements.

The correct question is not only:

“Did we have sales?”

But:

“Did the company have any transaction, income, expense, asset, liability or tax obligation?”

Step 2: Establish the Correct Status

The company may be:

  • dormant for Companies House;

  • dormant for HMRC;

  • non-trading, but with transactions;

  • active for part of the year;

  • VAT registered but not trading;

  • PAYE active but no salaries;

  • CIS contractor inactive;

  • ready for strike off.

Each status has different obligations.

Step 3: File the Companies House Documents

Depending on the situation:

  • dormant accounts;

  • micro-entity accounts;

  • small company accounts;

  • confirmation statement;

  • registered office update;

  • registered email address update;

  • director details update;

  • PSC details update;

  • identity verification details.

Do not leave the deadline until the last day.

Accounts rejected by Companies House are treated as not filed until they are accepted.

Step 4: Clarify the Position with HMRC

You must check:

  • whether HMRC is expecting a CT600;

  • whether the company has been marked dormant;

  • whether there is a Corporation Tax liability;

  • whether there are penalties;

  • whether VAT/PAYE/CIS schemes are active;

  • whether nil returns are required;

  • whether unused schemes need to be closed.

Step 5: Decide Whether to Keep or Close the Company

If the company will be used in the future:

  • keep it dormant;

  • file documents annually;

  • keep records;

  • keep company details up to date.

If the company will no longer be used:

  • check whether there are debts, assets, bank account, HMRC registrations;

  • close VAT/PAYE/CIS where applicable;

  • file outstanding returns;

  • pay taxes/penalties;

  • apply for voluntary strike off, if appropriate.

9. Voluntary Strike Off: When Does It Make Sense to Close the Company?

If the company had no activity and is no longer needed, you may consider closure through voluntary strike off.

This is done using form DS01 with Companies House.

Before strike off, you must check:

  • whether the company has a bank account;

  • whether there is money in the account;

  • whether there are assets;

  • whether there are debts;

  • whether there are HMRC liabilities;

  • whether there are VAT/PAYE/CIS obligations;

  • whether there are contracts;

  • whether there are loans;

  • whether tax refunds are expected;

  • whether all directors/shareholders agree, where applicable.

Very important:

If the company is dissolved and still has money or assets, these may pass to the Crown.

That is why the bank account and assets must be dealt with before dissolution.

Strike off must not be used as a way to avoid tax, debts or HMRC obligations.

10. Common Myths

Myth 1: “There was no activity, so I do not need to file accounts.”

False.

If the company exists at Companies House, accounts must be filed. They may be dormant accounts, if the company qualifies, but they still need to be filed.

Myth 2: “The Confirmation Statement is only filed if something changed.”

False.

The Confirmation Statement must be filed even if nothing has changed.

Myth 3: “If HMRC knows the company is not trading, Companies House knows automatically.”

False.

HMRC and Companies House are separate institutions. Dormancy must be handled correctly for each one.

Myth 4: “The company closes itself if I do not use it.”

False.

The company remains active until it is officially closed or until Companies House strikes it off. If it is forcibly struck off, unpleasant consequences may arise.

Myth 5: “If there is no tax to pay, there are no penalties.”

False.

Filing penalties can arise even if the tax liability is zero.

Myth 6: “The accountant is responsible, not the director.”

Partly false.

The accountant can help, but the legal responsibility for filing remains with the company directors.

If documents are filed late, Companies House and HMRC will penalise the company and/or directors, not only the accountant.

11. Checklist for an LTD Company with No Activity

If your company had no activity this year, check the following:

Companies House

  • What is the accounting reference date?

  • What is the accounts deadline?

  • Does the company qualify for dormant accounts?

  • Has the Confirmation Statement been filed?

  • Is the registered office correct?

  • Is the registered email address correct?

  • Are director details correct?

  • Are shareholder details correct?

  • Are PSC details correct?

  • Have directors/PSCs completed identity verification?

  • Are there penalties or a strike off notice?

HMRC

  • Has the company been notified as dormant for Corporation Tax?

  • Has HMRC issued a Notice to Deliver CT600?

  • Is there an outstanding Corporation Tax Return?

  • Are there penalties?

  • Is a tax repayment expected?

  • Did the company have interest income or other income?

VAT

  • Is the company VAT registered?

  • Have VAT Returns been filed?

  • Are nil VAT Returns required?

  • Is deregistration appropriate?

PAYE

  • Is the PAYE scheme active?

  • Were salaries paid?

  • Is an EPS no payment required?

  • Should the PAYE scheme be closed?

CIS

  • Is the company a CIS contractor?

  • Are there outstanding monthly returns?

  • Is a nil CIS return required?

  • Is an inactivity request required?

  • Should the contractor scheme be closed?

Business Reality

  • Will the company be used in the future?

  • Is there a bank account?

  • Is there money in the account?

  • Are there debts?

  • Are there assets?

  • Are there subscriptions?

  • Is there a director loan?

  • Is it better to keep the company dormant or close it?

12. Practical Plan Depending on Your Situation

Situation A: The Company Was Never Used

Solution:

  • notify HMRC that the company is dormant;

  • file dormant accounts;

  • file the Confirmation Statement;

  • check ID verification;

  • keep the company for the future or apply for strike off if it is no longer needed.

Situation B: The Company Traded in the Past, but Not This Year

Solution:

  • check whether the current year has transactions;

  • file the correct accounts;

  • file a CT600 if HMRC asks for it or if there was activity;

  • notify HMRC of dormancy from the correct date;

  • file the Confirmation Statement;

  • close VAT/PAYE/CIS if no longer needed.

Situation C: The Company Had No Sales, but Had Expenses

Solution:

  • do not automatically assume dormancy;

  • prepare accounts based on the real transactions;

  • check whether there is a loss;

  • check whether HMRC requires a CT600;

  • keep supporting documents.

Situation D: The Company Is VAT Registered

Solution:

  • file VAT Returns, even if nil;

  • consider deregistration;

  • check whether there is VAT to reclaim;

  • keep MTD records correctly.

Situation E: The Company Has an Active PAYE Scheme but Pays No Salaries

Solution:

  • submit EPS no payment, where applicable;

  • close the PAYE scheme if it will no longer be used;

  • check whether there are tax/NIC liabilities;

  • do not leave the payroll scheme active without submissions.

Situation F: The Company Is a CIS Contractor but Has No Subcontractors

Solution:

  • file nil CIS returns or request inactivity;

  • check penalties;

  • close the scheme if no longer required;

  • restart submissions if you begin using subcontractors again.

Situation G: The Company Is No Longer Needed

Solution:

  • check all obligations;

  • close the bank account after properly transferring funds;

  • pay liabilities;

  • file outstanding returns;

  • apply for DS01 strike off;

  • keep records after closure.

13. Why It Is Worth Resolving the Situation Quickly

A company with no activity may seem simple, but it can become complicated if ignored.

The risks include:

  • Companies House penalties;

  • HMRC penalties;

  • compulsory strike off;

  • loss of access to the company bank account;

  • assets passing to the Crown after dissolution;

  • difficulty reopening the company;

  • damaged Companies House record;

  • problems obtaining credit;

  • difficulties with contractors or clients;

  • risk of investigations if returns are missing;

  • unnecessary stress for the director.

The best time to deal with a dormant company is before the deadline.

The second-best time is now.

14. How DCTaxAgent Ltd Can Help

DCTaxAgent Ltd can help Limited Company directors quickly clarify whether their company is dormant, non-trading or active from an accounting and tax perspective.

We can help with:

  • checking the company status at Companies House;

  • checking accounts and Confirmation Statement deadlines;

  • preparing and filing dormant accounts;

  • preparing micro-entity accounts or small company accounts;

  • notifying HMRC that the company is dormant;

  • checking whether HMRC requires a CT600;

  • filing a nil CT600 or a CT600 for the active period;

  • checking VAT status;

  • filing nil VAT Returns;

  • VAT deregistration;

  • checking PAYE scheme;

  • EPS no payment;

  • closing PAYE scheme;

  • checking CIS contractor scheme;

  • CIS nil returns or inactivity request;

  • correctly closing a company through strike off;

  • Companies House ID verification support;

  • updating PSC/director/shareholder details;

  • advice on reactivating the company.

Do not let a company with “no activity” become a penalty problem.

15. Conclusion

If your LTD company had no activity this year, the good news is that the situation can be managed simply if you act on time.

The less positive news is that lack of activity does not mean lack of obligations.

You must check:

  • what dormant means for Companies House;

  • what dormant means for HMRC;

  • whether you have accounts to file;

  • whether you have a Confirmation Statement to file;

  • whether HMRC is expecting a CT600;

  • whether VAT/PAYE/CIS are active;

  • whether the company should be kept or closed.

The golden rule:

A Limited Company exists until it is officially closed. And as long as it exists, it has obligations.

DCTaxAgent Ltd

Accounting | Tax | Advisory

WhatsApp: 07587 532646
Email: contact@dctaxagent.co.uk
Website: www.dctaxagent.co.uk

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Has your LTD company had no activity this year? Learn what must be filed with Companies House and HMRC: dormant accounts, Confirmation Statement, Corporation Tax, VAT, PAYE, CIS, penalties and practical solutions.

Disclaimer

This article provides general information and does not constitute personalised tax advice. Each company’s position depends on transactions, HMRC status, VAT, PAYE, CIS, Companies House filings, directors, shareholders, PSCs and other specific circumstances. For an accurate assessment, seek advice from an authorised accountant or tax adviser.

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