Where To Know More About Dormant Company
It is that company which does not involve, during a financial year, in any account transaction. to put it in simple words, it has no accounting records. The sole aim of forming a dormant company is to protect the name of a company so that no one else can use it. certain companies would stop working but would like to continue in the future. during such situation, the companies prefer dormancy as this is considered as the non- business period.
Why one should opt for dormant company?
many of them wish to have a brand name and trade mark and this is the main cause to have a dormant company. the trade mark and brand name can be snatched by the competitors of same or different business. a company can have a dormancy period according to its wish since there is no time limit. Another common cause for a dormancy is the lack of sufficient financing to the company. due to this, the particular company wants to shut down itself. once the company decides to resume, it can get into dormancy without allowing anyone to use its trade mark or brand name. clear document should be produced legally by the director or the head of the company to be in dormant form.
an annual return to the house of companies should be assured although you are in dormant form.
all dormant companies must necessarily produce the files on its annual accounts in the house of companies. an accounts file should be submitted even if the company is not trading during the year.
in the financial year, the DCA form can be used by dormant companies without trade.
If there is a change in address, then it must be informed to the house of companies.
transactions cannot be done during dormancy, if so the company has to produce necessary files. there are few restricted zones where companies can make transaction and they are civil penalty of any kind, company name registration and payment to shareholders.
a dormant company need not produce information to the house of companies once it starts trading since it already produces all the information in that year. they have to face their directors and justify their failures if they fail to produce the details of transactions. Anyways its an offense and in such a condition the company may be subjected to severe civil penalty.
Find more info on dormant company and llp dormant accounts.
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