Company Strike off/ dissolution
If you have a dormant company or one that has simply come to the end of its life with no assets or liabilities, you can apply to the Registrar of Companies directly for the company to be dissolved. This can be done by filing Form DS01 at Companies House who will then advertise the proposed strike off in the London Gazette. This gives potential creditors, or other concerned parties, the ability to object to the strike off if necessary.
In some instances, Companies House may issue a compulsory strike off application against a company. This would usually be following a company’s failure to file accounts or a confirmation statement, for example. Broadly speaking, the outcome is the same as voluntarily filing a DS01; if nobody objects, the company will be struck off the company register.
FAQ’s relating to the Company Strike off / Dissolution process
Can a company be struck off if it has liabilities?
If you intend to apply for a company to be struck off, the directors have a duty to provide creditors with notice of the proposed strike off. This gives creditors to opportunity to object to the strike off application and take action into their own hands which could include the issuing of a winding up petition.
It is very important to note that the strike off process is not traditionally intended to be used where a company has liabilities. In such circumstances directors are urged to consider a creditors’ voluntary liquidation process instead.
What happens when a company is struck off?
Once the specified notice period of the proposed strike off has expired (usually 2 months) the company is dissolved. Upon dissolution the company is removed from the register at Companies House.
What happens to company assets upon dissolution?
If a company is dissolved which still has assets, such as cash at bank, or some machinery, this becomes bona vacantia; ownerless property. Such assets automatically vest in the Crown and managed by HM Treasury.
Not sure if the strike off option applies to you?
If your company has assets and/or liabilities and you would like to explore the strike off option, please contact us to discuss this before taking any steps. The small cost of the process may be appealing, but it comes with a number of key issues that can only be negated by the use of a formal insolvency process.