When do you qualify for Dormant Accounts?
By Cheaper Accountant, Nov 2 2015 05:56AM
Dormant accounts are the most simplified and straightforward type of limited company accounts. They are intended to be used when a company has no significant accounting transactions during an accounting period.
A significant accounting transaction is defined as a translation that should be entered into the company’s accounting records. This is a fairly broad definition that doesn’t leave much out of the equation. If you incur costs through the company bank account you are likely to not qualify for dormant accounts; even if the company has zero turnover (or sales income).
They are a small number of very specific transactions that can be incurred which still allow a company to qualify as dormant and in turn to submit dormant accounts.
1. Payment for shares by the subscribers to the memorandum of association.
2. Fees paid to Companies House
3. Payment of a civil penalty for the late filing of accounts.
As you can see from the brief list above items such as bank fees or bank interest are outside the scope of dormant transactions and any such transaction would result in full accounts needing to be prepared.
Our dormant accounts fee is only £50 and this covers the preparation and submission of limited company dormant accounts.