How to Close a UK Company in 2026: Strike Off, Dissolve or Liquidate

There are three ways to close a UK limited company: voluntary strike off, members' voluntary liquidation (MVL), and compulsory liquidation. The right route depends on whether the company has debts, assets, and how quickly you want to close. This guide explains each option, the costs, and the step-by-step process.

The Three Ways to Close a UK Company

Closing a UK limited company is not as simple as just stopping trading. The company legally exists until it is formally removed from the Companies House register. Failing to properly close a company means ongoing filing obligations — and potential fines or criminal liability for directors.

Option 1: Voluntary Strike Off (Dissolution)

Voluntary strike off is the cheapest and simplest way to close a UK limited company. You apply to have the company removed from the Companies House register using form DS01.

Eligibility Criteria

To apply for voluntary strike off, the company must not have:

• Traded or changed its name in the last 3 months
• Engaged in any other activity (other than settling affairs) in the last 3 months
• Unpaid debts or liabilities
• Active legal proceedings pending against it
• Any live insolvency procedures

It is suitable for companies that have simply stopped trading, never started trading, or been made dormant.

Step-by-Step Process

1. Settle all debts. Pay all creditors, HMRC, suppliers, and employees before applying.
2. Close business bank accounts and withdraw any remaining funds as a final dividend or salary (seek tax advice first).
3. File final accounts and corporation tax return with HMRC. Notify HMRC that the company is ceasing to trade.
4. Deregister for VAT (if registered) using form VAT7.
5. Submit DS01 to Companies House. All directors must consent. Cost: £33 (online), £44 (paper).
6. Gazette notice. Companies House publishes a notice in the London Gazette. There is a 2-month objection period.
7. Final Gazette notice. If no objections are received, Companies House publishes a final dissolution notice and removes the company from the register.

Total time from DS01 submission to dissolution: approximately 3–4 months.

Cost

Method	Fee
Online (via Companies House WebFiling)	£33
Paper (DS01 form by post)	£44

Who Can Apply?

Any director of the company can submit the DS01. All directors must be notified. The application cannot be made while the company has active trading, debts, or legal proceedings.

Option 2: Members' Voluntary Liquidation (MVL)

A members' voluntary liquidation (MVL) is used when a company is solvent (able to pay all debts) but has significant assets to distribute to shareholders. An MVL is more formal than strike off and requires a licensed insolvency practitioner.

When to Use MVL Instead of Strike Off

• The company has significant assets (cash, property, IP) that need to be formally distributed
• You want to take advantage of Business Asset Disposal Relief (formerly Entrepreneurs' Relief) on capital gains — this is only available through a formal liquidation, not strike off
• The company value makes the tax saving worth the cost of the insolvency practitioner

MVL Process Overview

1. Directors make a Declaration of Solvency confirming the company can pay all debts within 12 months
2. Shareholders pass a special resolution to wind up the company (75% majority required)
3. A licensed insolvency practitioner is appointed as liquidator
4. The liquidator distributes assets to shareholders, files final returns, and notifies HMRC and Companies House
5. Company is formally dissolved

Cost: typically £1,500–£5,000+ in insolvency practitioner fees depending on complexity. Timeline: 3–12 months.

Option 3: Creditors' Voluntary Liquidation / Compulsory Liquidation

If the company cannot pay its debts (is insolvent), strike off and MVL are not available. The options are:

Creditors' Voluntary Liquidation (CVL)

Directors and shareholders agree to wind up the insolvent company voluntarily. A liquidator is appointed to sell assets, pay creditors as much as possible, and dissolve the company. Directors should seek insolvency advice immediately if the company cannot pay its debts — continuing to trade while insolvent can lead to personal liability.

Compulsory Liquidation

A creditor (or HMRC) applies to court to have the company wound up. This is initiated against the company, not by it. Directors have little control over the process. A court-appointed official receiver manages the winding up.

What to Do Before Closing Your UK Company

Regardless of which closure route you take, complete these steps first:

1. Pay all PAYE/NI if you had employees
2. File your final corporation tax return and pay any tax owed
3. Deregister for VAT if applicable (form VAT7, file within 30 days of ceasing to trade)
4. File final annual accounts — these will be for a shorter period than usual
5. Cancel any direct debits and close business accounts
6. Distribute remaining assets to shareholders before applying for strike off
7. Notify Companies House of any outstanding changes (director changes, address changes)

What Happens to Company Assets at Dissolution?

Any assets remaining in the company at the point of dissolution become bona vacantia — they legally pass to the Crown (the Treasury Solicitor in England and Wales). This includes:

• Cash in bank accounts
• Intellectual property (trademarks, patents, copyrights)
• Physical property and equipment
• Contracts and receivables

To avoid losing assets to the Crown, ensure all assets are distributed to shareholders or otherwise dealt with before the dissolution takes effect. Bank accounts should be closed and funds withdrawn before submitting the DS01.

HMRC Obligations When Closing a UK Company

Companies House dissolution and HMRC are separate — closing the company at Companies House does not automatically tell HMRC. You must:

• File a final corporation tax return (CT600) marked as the final return
• Pay any outstanding corporation tax
• File final payroll submissions if you ran PAYE
• Submit a VAT deregistration application if VAT-registered
• Write to HMRC to advise the company is ceasing to trade

HMRC will issue a final corporation tax assessment after the last accounting period ends. Allow time for this before completing the dissolution.

Alternative: Make the Company Dormant

If you are unsure about closing the company permanently — perhaps you plan to restart trading in future — consider making it dormant instead of dissolving it.

A dormant company still needs to file annual accounts and a confirmation statement, but the cost is low (£50/year for the confirmation statement) and the company name and registration number are preserved. You can reactivate it at any time by simply starting to trade again.

Frequently Asked Questions

Can I reopen a company after it has been dissolved?

Yes, but it is expensive and complex. A dissolved company can be restored to the register within 6 years (for most cases) by applying to Companies House or through a court order. The fee for administrative restoration is £500 (from 2026). Restoration does not undo the bona vacantia rules — any assets that passed to the Crown during dissolution may not be recoverable.

Do I need a solicitor or accountant to close a UK company?

For voluntary strike off, it is not legally required but is advisable — especially to handle the final HMRC filings correctly. For MVL and CVL, a licensed insolvency practitioner is legally required.

Can a non-UK resident close a UK company?

Yes. The DS01 can be submitted online. All directors must consent. There are no residency requirements for the closure process, but all HMRC obligations must be met regardless of where the directors are based.

What if Companies House rejects my strike off application?

Companies House may suspend or reject a DS01 if it receives an objection from a creditor, HMRC, or another interested party, or if the company has outstanding filings. Resolve the outstanding issues and reapply.