UK Limited Companies - How to Stop Compulsory Strike Off ? 

Have you received a letter from Companies House notifying you that your company is going to be struck from the register? In this post, we look at what a compulsory strike off is, why it occurs, and how to stop it. Let’s get started.

What is a Compulsory Strike Off?

A compulsory strike off is a type of company dissolution where a company is forcibly closed by Companies House. This means you will no longer be able to trade under the limited company structure.

Why Does a Compulsory Strike Off Happen?

Companies House may start the process of striking off a company if they believe it is ‘no longer carrying on business or in operation.’ This can be triggered by:

• Overdue company documents such as annual accounts or confirmation statements, with no response to notification letters.
• Returned letters that were delivered to the company's registered office or director’s correspondence address.
• Lack of appointed directors; a private company limited by shares must always have at least one director.

How to Stop a Compulsory Strike Off

The good news is that if you wish to keep your company, stopping a compulsory strike off is relatively easy. Here’s how:

1. Respond: Contact Companies House immediately, both in writing and via phone or email, to notify them that the company is still operational.
2. Fix the Issues: Address the problem causing the strike off, usually overdue annual accounts or confirmation statements.
3. If the Annual Accounts are Overdue: Prepare and file them, noting that a late filing penalty may apply, up to £1,500.
4. If the Confirmation Statement is Overdue: Prepare and file it, as there are no penalties for late filing.

How Quickly Will Companies House Start the Process?

The timeframe varies but typically depends on the issue:

• Annual Accounts: No set maximum for how late they can be filed.
• Confirmation Statement: Must be filed within 14 days after the review period; otherwise, prosecution may occur.
• No Directors: A notification letter could be sent immediately if there are no directors.

Implications of a Compulsory Strike Off

A company that has been struck off can no longer trade. Additional implications include:

• Frozen bank accounts and all assets be seized and become Crown property.
• Possible investigation of directors' actions leading to the strike off.
• Redundancy for employees. Responsibilities for statutory payment to employee and authorities remains.
• Damage to the reputation of everyone involved.
• Directors be hold repsonsible personally for any unsettled liabilities and elgal cases even after closure of companies.
• Worst scenario involves director qualification and possibly criminal prosecution if inappropriate actions found. Worth to note these are listed reason to reject any settlement application by Home Office.

First Gazette Notice for Compulsory Strike Off

Companies House must publish their intent to strike off in The Gazette. If no response is received within 14 days, a first gazette notice is issued, giving two months to save the company.

Voluntary vs. Involuntary Strike Off

A voluntary strike off occurs when company officers choose to close the company, whereas an involuntary strike off can harm the company’s reputation.

Liquidation vs. Strike Off

Liquidation involves settling liabilities and distributing any leftover assets, while striking off is a simpler closure process.

How We Can Help You

We offer services to help avert a compulsory strike off:

• Dormant Company Accounts Service: £180 for preparing and filing dormant accounts.
• Confirmation Statement Service: £65 for handling confirmation statement filings.
• Company Dissolution Service: £180 for acting on your behalf regarding company tax returns and communication with authorities. Client needs to provide satisfactory and legal compulsory verification of identity. It does not include any cases which include complex and more hiddne beneficiary and non-natural person as owners. Also does not include any cases which are in dispute with the authorities.

Letting Companies House proceed with a compulsory strike off can harm everyone involved.

If you don’t need your company anymore, allow our dedicated team to close it properly.

In a nutshell you should now understand what a compulsory strike off is and how to respond if Companies House starts the process against your company. Elaga Accountancy aims to help our clients seamlessly, no matter big or small businesses. We are expertise in all UK matters. We arrange accounting and tax matters in a simple and affordable way. Contact us if you need our help. We hope you find this post helpful. Please leave a comment if you have any questions!

***Contact us to learn more.

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