Close a Limited Company or make it Dormant?

[GliderRider]

I have had a limited company for just over 21 years. Now, due to looking after my 85 year old mother who has Alzheimers, I am her full-time carer. Apart from her Alzheimers she is in fairly good health, so using her mother as a benchmark, could well live for another five to ten years. Short of putting Mum into a home, which my girlfriend and I are very reluctant to do (regardless of Covid-19), it is very unlikely that I would be able to work and care for Mum at the same time. Mum has enough savings/investments that money is not a primary concern, plus she lives in her own unmortgaged house. I and my cousin have power of attorney for her. Should Mum die, I could go back to work, although if we continue to live moderately frugally it shouldn't be essential.

The question is do I wind up my company completely or make it dormant? I was the sole employee of the company, so no-one else is affected. For the last tax year, when I was working, I paid in the region of £1000 in accountancy fees, and that was from me providing the accountant with totalised figures.

What sort of accountant's bill would one expect for a dormant company, and would I have to close my company bank account?

What are the visible and hidden costs of setting up a new limited company now?

Any personal experiences (benefits & pitfalls) of either making a company dormant or closing one and opening another, a year or more later, would be much appreciated.

[Eric Mc]

Why do you want to keep the company in existence - sentimentality?

My advice is usually to close down a company if you have no use for it in the foreseeable future.

Setting up a new company is fairly cheap these days. It can cost as little as £20.

[GliderRider]

Eric Mc, thank you for replying.

The reason for keeping it going is in case I did need/want to go back to work at some point, and I guess I have been concerned about the costs in so doing.

From what you say, closing the Ltd company is definitely the thing to do.

[Eric Mc]

Before you close it, make sure that it is essentially "emptied" of any assets and funds remaining AFTER all third party debts have been settled.

[GliderRider]

Eric Mc said:

Before you close it, make sure that it is essentially "emptied" of any assets and funds remaining AFTER all third party debts have been settled.

Good point Eric Mc, thanks!

[Damp Logs]

Interesting thread, can I hijack a little ?

I thought there were (now) significant costs of closing down a limited company.

I have two dormant companies that I file simple accounts and returns, with no accountant involved, and the cost is £13pa.

I also have a company that I’m thinking about doing the same, currently has property asset and cash in the bank, but I’m hoping I can clear it out, and then make it dormant. Am I missing something?

I bow to Eric Mc’s extensive experience and knowledge

[N8CYL]

I pay £90.00 per annum to an accountant. He sorts it all out.