How to strike off limited company in the UK

Strike Off (or “Dissolution”) is a procedure that enables you to close down your limited company and bring its life to an end. Strike off a limited company

Last year saw the highest number of strike-offs on record – over 580,000, an increase of 33% when compared to the previous year.

Strike Off is the most common way to close a SOLVENT company with NET ASSETS of up to £25,000.

It’s a quick, cheap, simple process.

All you need to do is file Form DS01 at Companies House with the requisite fee
• £8 if filed online, or
• £10 if sent by post

But remember, you MUST follow the procedure and guidelines detailed on the Government website noted below

What if your Net Assets are greater than £25,000?

Tax is payable on gains at the following rates:

• Capital Gains Tax at 10% on gains of up to £25,000.

• Income Tax at 20% to 45% on gains over £25,000

So where net assets are more than £25,000, you need to consider whether to either:

(i) Delay closure and take dividends or remuneration over one or more tax years so that you can utilise your lower rate tax bands; then strike off, or

(ii) Opt for a Members Voluntary Liquidation (or MVL)


• An MVL is commonly used where a company director is retiring and qualifies for Business Asset Disposal Relief (formerly known as Entrepreneur’s Relief)

• MVL’s are nearly always tax driven with the current Capital Gains Tax rate of 10% being charged on distributions to shareholders rather than income tax at higher tax rate bands.

• An MVL is a very straight forward process, although at a cost, as you need specialist tax advice and a qualified Insolvency Practitioner. However, these costs can easily be outweighed by the substantial benefits in tax savings.

• Also, unlike a strike off, a company cannot be restored to the register within the next 20 years where a liquidation process is used

Watch out for HMRC Targeted Anti-Avoidance Rules (TAAR) here. These deal with capital and dividend distributions. Get proper tax advice if in any doubt before commencing the process.

Members Voluntary Liquidation (MVL)

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When NOT to use Strike-Off Procedure
There can be serious consequences if directors use the Strike Off procedure as a means to try and avoid paying debts.

• There is currently a blanket objection by the Government to any strike-off application where there is an outstanding Bounce Back Loan.

• Indeed, legislation was introduced making such applications illegal, and many directors are now facing the consequences with disqualification, fines, and even imprisonment.

• Failure to notify all interested parties of a strike off application is an offence punishable by up to 12 months in prison!

Note also that Creditors have up to 20 years after dissolution to restore a company to the register so that they can pursue recovery of a debt.

Where a company is insolvent, a Creditors’ Voluntary Liquidation (CVL) might therefore be the only available option.

Strike Off should NOT be used where a company is insolvent

Our insolvency practitioner is licensed by the Insolvency Practitioners Association and, with decades of experience, can offer you the expertise and guidance needed to assist you through the liquidation process.

Take advantage of a free, no obligation, confidential, direct chat with our Insolvency Practitioner.

Give us a call today on 0800 169 1536 or visit our website at [ Ссылка ] for more information.

00:00 Company Strike Off
00:17 Strike Offs – Dormant Companies
00:43 What if Net Assets are greater than £25,000?
01:19 Members Voluntary Liquidation (MVL)
02:19 Strike Off should NOT be used where a company is insolvent
03:14 Contact Us

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