Before applying for strike-off, send HMRC your final accounts and Company Tax Return, and pay the company’s outstanding taxes.
Business Asset Disposal Relief (BADR) can apply to qualifying capital distributions before strike-off. It does not always require a members’ voluntary liquidation (MVL). Capital treatment and eligibility for BADR are separate checks.
1. Check that strike-off fits your company
Your company must not have traded, sold stock or changed its name in the last 3 months. It must not be threatened with liquidation or have an agreement with creditors, such as a Company Voluntary Arrangement.
Strike-off is not an alternative to formal insolvency proceedings. If you cannot pay the company’s debts, get advice from an insolvency practitioner before applying.
2. Prepare your final accounts and tax return
Send HMRC the final statutory accounts and Company Tax Return. State that these are the final trading accounts and that you plan to have the company struck off. You do not have to file final accounts with Companies House.
The Company Tax Return deadline is 12 months after the accounting period ends. The Corporation Tax payment deadline is usually 9 months and one day after the period ends. Do not wait for strike-off to deal with a payment already due.
The joint online accounts and Company Tax Return service closed on 31 March 2026. Use commercial software for HMRC filing from 1 April 2026. Paper Company Tax Returns are only allowed if you have a reasonable excuse or are filing in Welsh.
If you made a loss in your final year of trading, ask your accountant about terminal loss relief. You may be able to claim it on your final return against profits from earlier years.
3. Close your PAYE scheme
Tell HMRC straight away when you stop employing people. Submit a final Full Payment Submission (FPS) or Employer Payment Summary (EPS), select “Final submission because scheme ceased” and enter the date the scheme closed.
Pay final wages and follow the redundancy rules if you make staff redundant.
Pay any outstanding payroll tax and National Insurance, send expenses and benefits returns, enter employees’ leaving dates and give each employee a P45 on their last day.
4. Cancel your VAT registration
If you are VAT registered and stop trading or making taxable supplies, cancel your registration within 30 days of becoming ineligible. You can apply online when you have stopped trading and are not part of a VAT group.
File your final VAT Return up to and including the cancellation date. Use the due date HMRC sends you or shows in your VAT online account. The 30-day cancellation deadline is not the final return deadline.
Stop charging VAT from the cancellation date and keep VAT records for 6 years.
5. Settle tax and collect refunds
Pay all outstanding Corporation Tax and other tax liabilities before applying for strike-off.
Collect refunds and deal with the company’s assets before dissolution. Any assets still owned by the company when it is dissolved, including cash, pass to the Crown.
If you need to stop an application already in progress, you can withdraw it while the company is still on the register. You can use the online service or send form DS02 by post; this withdraws the application rather than suspending it.
6. Check the tax treatment of distributions
For distributions in anticipation of strike-off to fall within the capital gains rules, the total of the relevant distributions must not exceed £25,000. This is an aggregate limit for the company’s distributions, not an allowance for each shareholder or a test of the company’s total asset value.
If the total is over £25,000, the whole amount, not just the excess, is normally taxed as a dividend.
At the time of distribution, the company must have collected, or intend to collect, debts owed to it and paid, or intend to pay, its own debts. If it has not been dissolved after 2 years, or the debt condition has not been met by then, normal distribution treatment applies.
Ask your accountant to confirm the treatment before distributing money or assets. Do not choose a closure route from a threshold alone.
7. Check BADR separately
Capital treatment does not automatically give you BADR. HMRC’s guidance includes “any other capital distribution”, so a formal liquidation is not a universal requirement.
For ordinary shares outside the EMI rules, the conditions generally include being an officer or employee, the company being a trading company or holding company of a trading group, and your holding at least 5% of ordinary share capital and voting rights. You must also have the required 5% entitlement to profits and winding-up assets, or sale proceeds. Ask your accountant to check all conditions for your shares.
For a capital distribution, the conditions must be met throughout the 2 years ending with the distribution date. If the company stopped qualifying as a trading company earlier, the qualifying period ends at cessation and the distribution must be made within 3 years of cessation.
8. Apply and send copies
The strike-off application, DS01, must be signed by a majority of directors. If there are 2 directors, both must apply; a sole director can apply alone.
Send a copy of the application within 7 days to shareholders, creditors, employees, pension fund managers or trustees, and directors who did not sign it.
9. Follow the Gazette notices
If Companies House accepts the application, it publishes a notice in The Gazette. If nobody objects, strike-off follows once the 2 months in the notice have passed. A second notice confirms that the company no longer legally exists.
10. Keep the company’s records
Keep business documents, such as bank statements, invoices and receipts, for 7 years after strike-off. If you employed people, keep copies of the employers’ liability insurance policy and schedule too.