Dissolving a limited company

Nazitf

I wish to dissolve my limited company however there is currently a balance of approximately £200 in the business account. How can I withdraw this money?

Background: The company traded in the last financial year and I took salary and dividend payments. The above amount now remains in the company (the company has no other assets).

darkblue_2

What creditors are remaining? What was the status of the company prior to your wish for dissolution? Was it dormant or actively trading? If the latter, and you weren't trading with assets, technically you could be found guilty of wrongful trading in knowing that you couldn't continue in business and meet your liabilities.

More info please.

Pennywise

Presumably the company had paid its PAYE (if any) on your directors fees and corporation tax on its pre-dividend profits, and VAT (if registered).

HMRC will block the striking off at Companies House if they've not received all due returns and taxes due, so your first port of call is making sure all returns and the company accounts are submitted to HMRC.

Assuming that the £200 isn't the balance of any loan due back to you, there's a choice. You can pay it through payroll, dividend or as a capital distribution. I'd say dividend is simplest but payroll may work for you, as could the capital route. Probably best to ask your accountant.

Nazitf

Thanks for the replies.

I am the only director of the company and the sole share holder. Therefore there aren’t any other creditors. The company was created and actively trading since September 2009 to March 2010. I waited until my annual return could be completed (August 2010) before starting the dissolution process.

The company doesn’t have to be dissolved, it could just be kept dormant but essentially I don’t need it anymore and I don’t want to have a pay an annual fee to companies house to keep the company running.

The company has paid PAYE on the directories salary (nothing was required since it was below the threshold for NI). Corporation tax is about to be paid in the next few weeks. The company is not VAT registered.

The £200 balance in the business account has come from profits the company made whilst trading. The reason this was taken as part of the dividend payment was because I wasn’t sure if it would be required for other business fees e.g. accountant fees etc.

I want to transfer this money in the most tax efficient way. If I took it as a dividend, would the company pay corporation tax on this? And would another annual return be due?

HappyMJ

Just pay through payroll with no tax and no NI at £100 per week. HMRC and Companies House aren't usually concerned with small amounts. It's not worth the effort.

Nazitf

If I paid it through PAYE would another annual return be due next year (hence another set of accountant fees)? Or would I just need to submit the P14 & P35 forms?