- There are two main ways to close a UK limited company: voluntary strike-off using form DS01, and liquidation. The right one depends on whether your company is solvent.
- Voluntary strike-off now costs £13 online or £18 by post, down from £33, since 1 February 2026. It only works if your company has no debts it cannot pay and meets the eligibility rules.
- If your company owes money it cannot settle, you need a liquidation handled by a licensed insolvency practitioner, not a strike-off.
If you want to close a limited company in the UK, you have two main routes: a voluntary strike-off using form DS01, or a liquidation. A solvent company that has stopped trading with no outstanding debts can usually be struck off for as little as £13. One that owes money it cannot pay needs a formal liquidation instead.
Getting this choice right matters, because closing the wrong way can leave you personally exposed. This Sleek guide walks through both routes, the eligibility rules, and the order to do things in.
Closing a UK limited company at a glance
Decision point | Detail |
Cheapest route | Voluntary strike-off (DS01): £13 online, £18 by post |
When strike-off works | Solvent company, stopped trading 3+ months, no ongoing disputes |
When you need liquidation | Company owes money it cannot pay, or members want a formal solvent wind-up (MVL) |
Typical timeline | Strike-off: around 2 to 3 months after the notice is published |
Still to settle first | Final accounts, final Corporation Tax, closing payroll and VAT, distributing assets |
What are the two ways to close a limited company?
The two routes for how to close a limited company in the UK are voluntary strike-off and liquidation, and they suit very different situations. Voluntary strike-off, also called dissolution, removes your company from the Companies House register using form DS01. It is the simple, low-cost option for a company that has stopped trading and has nothing left to settle. Liquidation is a more formal process that turns the company’s assets into cash, pays off what it can, and then dissolves the company.
The deciding factor is solvency. If your company can pay all its debts, strike-off or a solvent liquidation will fit. If it cannot, you are into insolvent liquidation, which has to be run by a licensed insolvency practitioner. The table below sums up the split.
Route | Best for | Run by | Rough cost |
Voluntary strike-off (DS01) | Solvent, dormant companies with no debts | The directors | £13 to £18 filing fee |
Members’ Voluntary Liquidation (MVL) | Solvent companies with significant assets to distribute tax-efficiently | Licensed insolvency practitioner | Practitioner fees, often £1,500+ |
Creditors’ Voluntary Liquidation (CVL) | Insolvent companies that cannot pay their debts | Licensed insolvency practitioner | Practitioner fees, varies |
And if you’d prefer to verify your status via a questionnaire:
Question | Yes | No |
Can the company pay all its debts? | Strike-off or MVL | Creditors’ Voluntary Liquidation (CVL) |
Has it stopped trading for 3+ months? | Strike-off available | Wait, or use liquidation |
Are there assets worth more than £25,000 to distribute? | Consider an MVL for tax efficiency | Strike-off is usually enough |
Can you use voluntary strike-off to close your limited company?
You can use voluntary strike-off only if your company meets a set of eligibility rules, and most small dormant companies do. The route is designed for companies that have genuinely wound down, not for dodging creditors or paperwork. Companies House can reject or reverse a strike-off if the conditions are not met.
To apply for strike-off, your company must not have done any of the following in the last three months:
- Traded or sold off stock, other than to wind the business down
- Changed its name
- Started or threatened any formal insolvency proceedings
- Entered an agreement with creditors, such as a Company Voluntary Arrangement
You also need to deal with anyone who has an interest in the company before you file. Within seven days of sending form DS01 to Companies House, you must send a copy to all interested parties: other directors who did not sign, shareholders, creditors, employees, and any pension fund trustees or managers. This is how the law gives those people a chance to object.
Close your business bank account only after any final tax is paid and any remaining cash is distributed to shareholders. Money left in a company account at dissolution can pass to the Crown under "bona vacantia", and getting it back is slow.
What are the steps to close a limited company using DS01?
Closing via DS01 follows a clear sequence, and doing the steps in order keeps the process clean. Once your company is eligible and has stopped trading, the strike-off itself is mostly form-filling and waiting. The filing fee is £13 if you apply online and £18 if you apply by post, both reduced from £33 on 1 February 2026.
- Stop trading and settle outstanding bills, then collect any money owed to the company.
- Prepare and file your final accounts and final Corporation Tax return, and tell HMRC the company has stopped trading.
- Close down payroll (PAYE) and deregister for VAT if registered.
- Distribute any remaining assets and cash to shareholders before applying, so nothing is left in the company.
- File form DS01 with Companies House, online for £13 or by post for £18, signed by a majority of directors.
- Send a copy of the application to all interested parties within seven days.
Companies House then publishes a notice in the relevant Gazette. If no one objects, the company is usually struck off and dissolved around two to three months after that notice. For the detail on filing your final return, see our guide to corporation tax filing.
When do you need a liquidation instead of strike-off?
You need a liquidation when strike-off is not appropriate, which usually comes down to debts or assets. There are two voluntary types, and the right one depends again on solvency. Both are run by a licensed insolvency practitioner rather than the directors.
A Members’ Voluntary Liquidation (MVL) is for solvent companies, often where directors want to extract retained profits efficiently. Distributions in an MVL can be treated as capital rather than income, which may qualify for Business Asset Disposal Relief and a lower tax rate, so it can beat a simple strike-off for asset-rich companies. A Creditors’ Voluntary Liquidation (CVL) is for insolvent companies that cannot pay their debts; the practitioner sells the assets, pays creditors in order of priority, and the company is wound up.
As a rough guide, accountants often suggest considering an MVL once there is more than around £25,000 to distribute, because the tax saving can outweigh the practitioner’s fee. Below that, strike-off is usually the cheaper and simpler choice. To understand whether your company still counts as trading for tax during wind-down, see trading and non-trading for corporation tax.
What do you need to do about final accounts, tax and HMRC when closing a company?
Before any company can be closed, you must settle its tax affairs and tell HMRC, whichever route you take. Closing the company at Companies House does not close it at HMRC; those are separate steps, and skipping the HMRC side is where people get caught out. You will need to prepare final statutory accounts and a final Company Tax return, marking the date the company stopped trading.
The main tasks are:
- File final accounts and a final Corporation Tax return, then pay any tax due. The small profits rate is 19% on profits up to £50,000, and the main rate is 25% on profits over £250,000.
- Tell HMRC the company has stopped trading so it is treated as dormant or closed for Corporation Tax.
- Run a final payroll, issue final P45s, and close the PAYE scheme.
- Submit a final VAT return and cancel your VAT registration, normally within 30 days of stopping trading.
You also still have to keep business records, such as bank statements and invoices, for seven years after the company closes.
Sleek can prepare your final accounts and tax return so you can close cleanly, without missing an HMRC step.
What can go wrong when you close a limited company?
The most common problems come from closing in the wrong order, or trying to strike off a company that should be liquidated. If a creditor, including HMRC, objects to your strike-off, Companies House will suspend the application, and unresolved debts do not disappear. Directors who strike off a company to avoid paying creditors can face an unwound dissolution and, in serious cases, disqualification.
A few specific pitfalls to watch:
- Leaving cash in the company at dissolution, which then passes to the Crown as bona vacantia.
- Forgetting to close PAYE or VAT, which leaves filings and penalties building up. Our guide to HMRC and Companies House fines covers what those look like.
- Missing the ongoing confirmation statement obligations while the strike-off is still in progress.
It is also worth knowing that a struck-off company can sometimes be restored to the register, for example if a creditor was missed or an asset turns up later. Restoration is a separate legal process with its own rules, and it is the opposite action to the one covered here, so plan your closure carefully to avoid needing it. If you are setting up rather than closing, our company registration guide covers the full lifecycle.
When strike-off is the wrong choice for closing your company
Voluntary strike-off is not a way to walk away from debt. If your company owes money it cannot pay, has ongoing disputes, or faces threatened legal action, you should not file a DS01. The correct route is a liquidation handled by a licensed insolvency practitioner, who has a legal duty to creditors. Closing improperly can be reversed and can expose directors personally, so when there are debts, get formal advice first.
How Sleek helps with closing your limited company
Closing a company properly is mostly about doing the tax and filing steps in the right order, on time. Sleek prepares your final accounts and final Corporation Tax return, closes your payroll and VAT, and makes sure HMRC and Companies House are both squared away before you file. If your situation calls for a liquidation rather than a strike-off, we will tell you straight and point you to the right specialist.
Disclaimer: The preceding information is not legal advice. This content is aimed to provide general guidance. For more formal or legal advice, contact Sleek directly.
450,000
businesses worldwide.
satisfaction rate from
16,000 surveyed clients.
FAQs on how to close a limited company in the UK
How much does it cost to close a limited company in the UK?
The cheapest route, a voluntary strike-off, costs £13 if you file form DS01 online or £18 by post, both reduced from £33 on 1 February 2026. A liquidation costs more, because a licensed insolvency practitioner must run it, with fees that often start around £1,500 for a straightforward members’ voluntary liquidation. You should also budget for finalising your accounts and tax return.
How long does it take to dissolve a company?
A voluntary strike-off usually completes around two to three months after Companies House publishes the strike-off notice in the Gazette, assuming no one objects. The clock only starts once your company is eligible, meaning it has not traded for three months. Liquidations take longer, often six months to a year or more, depending on how many assets and creditors are involved.
Can I close a limited company that still has debts?
No, you cannot use a voluntary strike-off if the company has debts it cannot pay. Strike-off is only for solvent companies. If your company is insolvent, you must use a Creditors’ Voluntary Liquidation run by a licensed insolvency practitioner, who has a legal duty to creditors. Trying to strike off an indebted company can be reversed and may put directors at personal risk.
What is the difference between dissolution and liquidation?
Dissolution, done by voluntary strike-off, simply removes a solvent company from the register and is run by the directors. Liquidation is a formal process run by a licensed insolvency practitioner that turns assets into cash and pays creditors before the company is dissolved. In short, dissolution is the cheap end point for a clean company; liquidation handles companies with assets to distribute or debts to settle.
Do I need to tell HMRC if I close my company?
Yes. Closing your company at Companies House does not close it at HMRC, which is a separate step many people miss. You must file a final Corporation Tax return, pay any tax due, run a final payroll to close your PAYE scheme, and submit a final VAT return to cancel your registration, normally within 30 days of stopping trading. You must also keep business records for seven years after closure.
View more
Can a closed company be brought back?
Yes. A struck-off company can sometimes be restored to the Companies House register, for example if a creditor was overlooked or an asset is discovered after dissolution. Restoration is a separate legal process with its own application and rules, and it can be administrative or done through a court order. This is one reason to distribute all assets and settle all debts before you apply to strike off.
Should I strike off or use an MVL if my company has cash left?
It depends on how much is left. Many accountants suggest considering a Members’ Voluntary Liquidation once there is more than around £25,000 to distribute, because MVL distributions can be treated as capital and may qualify for Business Asset Disposal Relief at a lower tax rate. Below that, a simple strike-off at £13 is usually cheaper once you account for the insolvency practitioner’s fee on an MVL.
