Directors' duties in a dormant company

Q: Which filings must a dormant company still make?

Three kinds of filing continue. Annual accounts. Section 441 puts the duty to deliver accounts on the directors. A private company has nine months from the end of its accounting reference period (section 442). Companies House guidance says dormant accounts have the same deadline and the same late filing penalties as any other accounts. Confirmation statement. Section 853A requires a confirmation statement within 14 days after the end of each 12 month review period. Companies House guidance confirms that dormant and non trading companies must file at least once a year. The fee is £50 online or £110 on paper. See the confirmation statement explained. Event driven changes. GOV.UK guidance on running a limited company says Companies House must be told within 14 days of changes to directors and secretaries. Changes to people with significant control, the registered office and the registered email address must also be reported. Dormant accounts sent to Companies House need no profit and loss account or directors' report. They must contain a balance sheet with a statement above the director's signature that the company was dormant throughout the period, the previous year's figures and certain notes. The paper form AA02 is only for a company that has been dormant since incorporation. It cannot be used by a dormant subsidiary or by a company that became dormant after trading.

A dormant company still has directors with full legal duties. They must deliver annual accounts and a confirmation statement every year, keep the accounting records, register of members and minutes, keep an appropriate registered office and registered email address, and be identity verified with Companies House. Dormancy reduces the paperwork; it does not switch off the Companies Act.

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What does being dormant actually change for a director?

For Companies House, section 1169 of the Companies Act 2006 says a company is dormant during any period in which it has no significant accounting transaction, meaning a transaction that section 386 requires to be entered in the accounting records. Only a short list of items is disregarded: shares taken by subscribers on formation, Companies House fees for a change of name, re registration or a confirmation statement, and a late filing penalty under section 453.

Being dormant brings two practical benefits. The company can usually claim exemption from audit under section 480, and it can file simple dormant accounts. HMRC uses a separate test for Corporation Tax, so a company can be dormant for one purpose and not the other. Our page on dormant company accounts and tax covers the two definitions in detail.

What dormancy does not change is the legal position of the people on the board. Section 170(1) says the general duties in sections 171 to 177 are owed by a director of a company to the company, and there is no carve out for companies that are not trading.

Which filings must a dormant company still make?

Three kinds of filing continue.

Annual accounts. Section 441 puts the duty to deliver accounts on the directors. A private company has nine months from the end of its accounting reference period (section 442). Companies House guidance says dormant accounts have the same deadline and the same late filing penalties as any other accounts.
Confirmation statement. Section 853A requires a confirmation statement within 14 days after the end of each 12 month review period. Companies House guidance confirms that dormant and non trading companies must file at least once a year. The fee is £50 online or £110 on paper. See the confirmation statement explained.
Event driven changes. GOV.UK guidance on running a limited company says Companies House must be told within 14 days of changes to directors and secretaries. Changes to people with significant control, the registered office and the registered email address must also be reported.

Dormant accounts sent to Companies House need no profit and loss account or directors’ report. They must contain a balance sheet with a statement above the director’s signature that the company was dormant throughout the period, the previous year’s figures and certain notes. The paper form AA02 is only for a company that has been dormant since incorporation. It cannot be used by a dormant subsidiary or by a company that became dormant after trading.

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Which records and registers must still be kept?

Section 386 requires every company to keep adequate accounting records, and section 388(4) requires a private company to preserve them for three years from the date they are made. For a dormant company the records may be thin, but the bank statements, the share capital entries and any balance owed to or by a director still need to be kept and reconciled.

The register of members under section 113 must still be maintained. Since 18 November 2025 companies no longer keep their own register of directors or register of people with significant control: sections 161A to 167F and Chapter 3 of Part 21A were omitted from that date by the Economic Crime and Corporate Transparency Act 2023. That information now sits only at Companies House. Our guide to statutory registers sets out what remains.

If the directors meet or take decisions, section 248 requires minutes of board meetings to be kept for at least ten years. Section 355 imposes the same ten year period on members’ written resolutions and general meeting minutes.

Do the general duties still apply when nothing is happening?

Yes. A director must act within the constitution (section 171), promote the success of the company (section 172), exercise independent judgment (section 173) and exercise reasonable care, skill and diligence (section 174). In a dormant company, reasonable diligence usually means checking the bank account, reading post and emails sent to the company, and making sure the filings are made rather than assuming the accountant has done them.

The conflicts duty in section 175 is often overlooked. It applies in particular to the exploitation of any property, information or opportunity, and section 175(2) says it is immaterial whether the company could take advantage of it. A dormant company that owns a trading name, a website domain, a lease or a contract right is still the owner. A director who quietly moves that asset into a new business without authorisation risks a breach, even though the dormant company was doing nothing with it.

If the dormant company owes money, for example an old loan from a former shareholder, section 172(3) makes the duty to promote success subject to any rule of law requiring directors to consider creditors’ interests. The Insolvency Service says that once a company is insolvent, directors must treat all creditors the same and not prioritise one over another.

What must a director keep current about the company itself?

Three duties introduced or strengthened by the 2023 Act apply to every company, trading or not.

Registered office. Section 86 requires the registered office to be an appropriate address at all times, meaning post delivered there would be expected to come to the attention of someone acting for the company and delivery can be acknowledged.
Registered email address. Section 88A requires an appropriate email address, one where emails from the registrar would be expected to come to the attention of a person acting for the company.
Identity verification. Section 167M says an individual must not act as a director unless their identity is verified, and the company must ensure this. Companies House will not accept a confirmation statement until every director has verified.

These carry particular weight for dormant companies. Under section 1000, if the registrar has reasonable cause to believe a company is not carrying on business, the registrar may write to ask whether it is. If no answer comes back to that letter and a second one, the company can be struck off. A dormant company whose registered office is a former accountant’s address may never see those letters.

What does HMRC expect from a dormant company?

GOV.UK guidance says a company is usually dormant for Corporation Tax if it has stopped trading and has no other income, or is a new company that has not started trading. Trading includes buying, selling, renting property, advertising, employing someone or getting interest. HMRC may write to say it is treating the company as dormant. If a notice to deliver a Company Tax Return has been issued, a return must still be filed.

If the company is registered for VAT and does not intend to trade again, it must deregister within 30 days of becoming dormant. If it plans to restart, it must keep sending nil returns. If it does not plan to restart trading in the tax year, it should close its PAYE scheme. When trading restarts, section 55 of the Finance Act 2004 requires notice to HMRC of the start of the new accounting period no later than three months after it begins. The wider position is covered in directors’ tax responsibilities.

How does this look across a year?

Illustration only. Redwood Holdings Ltd has a 31 March year end and has not traded since it sold its business. Its directors are Ann and Ben.

Accounts for the year to 31 March 2026 must reach Companies House by 31 December 2026. Because it traded in the past, it cannot use form AA02, so it files dormant accounts online with the section 480 statements.
Its confirmation statement is due 14 days after its review period ends. Before filing, Ann and Ben must both have verified their identity.
The bank deducts a monthly account fee. That payment is a transaction the accounting records must show, and it is not on the section 1169 list of disregarded items, so the company may not be dormant for Companies House purposes for that year. If the account is not needed, closing it avoids the problem.
Ben resigns. The company must notify Companies House within 14 days, and Ann remains responsible for the filings on her own.

What mistakes do directors of dormant companies make?

Assuming that because HMRC treats the company as dormant, nothing needs to go to Companies House.
Filing form AA02 for a company that traded in an earlier year, or for a dormant subsidiary.
Letting small bank charges or interest run through the account without realising they affect dormant status.
Leaving the registered office or registered email with an adviser who no longer acts, so registrar letters go unanswered.
Forgetting identity verification, which blocks the confirmation statement.
Forgetting that section 423 still requires a copy of the annual accounts to be sent to every member.

Missing an accounts deadline is not only a civil penalty for the company. Section 451 makes it an offence by every director, which is explained in whether directors can be prosecuted for not filing accounts. If the company has no future, compare the costs in keeping a company dormant or striking it off.

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Sources

Reviewed by Christine Anderson, Broker, Solar Protect. Last reviewed 24 October 2026. Part of Accountapedia, the Solar Protect guide to UK tax and accounting. This page is general information, not personalised advice.

Directors’ duties in a dormant company