Bank Account Issue - Limited Co
Discussion
I opened an online bank account 2 years ago and ticked the limited company box, having formed the limited co maybe a week before. We had a think about it for a few weeks and decided not to use the limited company, served a dormant limited co notice to companies house it was and finally wound up the company a few months ago dissolving it. All my tax returns have been completed as a sole trader rather than a limited co.
I have been using the bank account for my business not really thinking about it as nowhere on the app does it state you are a limited co, the only place I can see that it appears is on payments out. On Saturday I couldn't make a payment, finally got a response from the bank and they have suspended my account as the limited co has been dissolved. There is a decent balance in the account. I have creditors I am worried about paying them out of my own pocket and then finding I have also lost this money.
The bank state that the account will be closed in 6 weeks and the money passed to the courts and I have to apply for a creditors order at a cost of £280 to get the funds back. Alternatively I can get the limited co reinstated for a £100 fee but this is going to mean producing accounts.
I doubt there is any arguing with the bank as they are operating within the strict regulatory framework they have, it seems I have to wait and try to claim the money back as a creditor. If anyone has any advice for me please comment it would be very much appreciated.
I have been using the bank account for my business not really thinking about it as nowhere on the app does it state you are a limited co, the only place I can see that it appears is on payments out. On Saturday I couldn't make a payment, finally got a response from the bank and they have suspended my account as the limited co has been dissolved. There is a decent balance in the account. I have creditors I am worried about paying them out of my own pocket and then finding I have also lost this money.
The bank state that the account will be closed in 6 weeks and the money passed to the courts and I have to apply for a creditors order at a cost of £280 to get the funds back. Alternatively I can get the limited co reinstated for a £100 fee but this is going to mean producing accounts.
I doubt there is any arguing with the bank as they are operating within the strict regulatory framework they have, it seems I have to wait and try to claim the money back as a creditor. If anyone has any advice for me please comment it would be very much appreciated.
From what you've said if money was going in and out of the Limited Company Account then the Ltd Co was trading and shouldn't have filed dormant accounts.
The bank aren't being difficult here, the funds don't belong to you they belong to the Ltd Co, which has now been wound up, hence why you need to apply to the court.
The bank aren't being difficult here, the funds don't belong to you they belong to the Ltd Co, which has now been wound up, hence why you need to apply to the court.
Mr Overheads said:
From what you've said if money was going in and out of the Limited Company Account then the Ltd Co was trading and shouldn't have filed dormant accounts.
The bank aren't being difficult here, the funds don't belong to you they belong to the Ltd Co, which has now been wound up, hence why you need to apply to the court.
Thanks Mr Overheads yes messed up here. The bank aren't being difficult here, the funds don't belong to you they belong to the Ltd Co, which has now been wound up, hence why you need to apply to the court.
Eric Mc said:
Who dissolved the limited company?
At any point in your business affairs did you make use of the services of an accountant?
Hi Eric. Nice to know you have had a read thank you for your comment. At any point in your business affairs did you make use of the services of an accountant?
My wife is a certified accountant and does my simple sole trader accounts, but her everyday job is more people management than nuts and bolts and she is not sure what to do. I filed them as self employed after realising the limited company was not that more tax efficient than being a sole trader a couple of weeks after opening the bank account. It isn't a big business, just a Sunday job helping running clubs to put on events.
I just forgot the that bank account was a limited one rather than a sole trader. I put the limited company into suspension and decided to close it a few months ago because trading was terrible with the virus.
Looking at the restoration because I dissolved the company I have to have a court hearing at a cost of £800.
I am going to have to seek professional advice, am I best to speak to a solicitor or an accountant please Eric?
lost in espace said:
Alternatively I can get the limited co reinstated for a £100 fee but this is going to mean producing accounts.
This is almost certainly the best option.I am quite surprised in this world of automated fraud checks that the bank didn't notice that its customer was not an extant entity for quite so long.
lost in espace said:
Hi Eric. Nice to know you have had a read thank you for your comment.
My wife is a certified accountant and does my simple sole trader accounts, but her everyday job is more people management than nuts and bolts and she is not sure what to do. I filed them as self employed after realising the limited company was not that more tax efficient than being a sole trader a couple of weeks after opening the bank account. It isn't a big business, just a Sunday job helping running clubs to put on events.
I just forgot the that bank account was a limited one rather than a sole trader. I put the limited company into suspension and decided to close it a few months ago because trading was terrible with the virus.
Looking at the restoration because I dissolved the company I have to have a court hearing at a cost of £800.
I am going to have to seek professional advice, am I best to speak to a solicitor or an accountant please Eric?
Initially I would say an accountant. Restoring a dissolved company is more costly and complex than setting one up. If there were significant funds resting in the limited company bank account you stand to lose those funds, so paying for the reinstatement of the company might be worth the costs involved.My wife is a certified accountant and does my simple sole trader accounts, but her everyday job is more people management than nuts and bolts and she is not sure what to do. I filed them as self employed after realising the limited company was not that more tax efficient than being a sole trader a couple of weeks after opening the bank account. It isn't a big business, just a Sunday job helping running clubs to put on events.
I just forgot the that bank account was a limited one rather than a sole trader. I put the limited company into suspension and decided to close it a few months ago because trading was terrible with the virus.
Looking at the restoration because I dissolved the company I have to have a court hearing at a cost of £800.
I am going to have to seek professional advice, am I best to speak to a solicitor or an accountant please Eric?
There are also big tax impacts as well stemming from the rather sloppy approach you had to dealing with your limited company. All that money that went into the company bank account was an inadvertent statement that the company was actually trading - so the company should have been preparing accounts, submitting Corporation Tax returns and paying Corporation Tax on the profits. Also, any money extracted by your personally from the company bank account should have been declared as either director's salary or dividends.
How many years did this go on for?
Eric Mc said:
Initially I would say an accountant. Restoring a dissolved company is more costly and complex than setting one up. If there were significant funds resting in the limited company bank account you stand to lose those funds, so paying for the reinstatement of the company might be worth the costs involved.
There are also big tax impacts as well stemming from the rather sloppy approach you had to dealing with your limited company. All that money that went into the company bank account was an inadvertent statement that the company was actually trading - so the company should have been preparing accounts, submitting Corporation Tax returns and paying Corporation Tax on the profits. Also, any money extracted by your personally from the company bank account should have been declared as either director's salary or dividends.
How many years did this go on for?
2 and a half years Eric. I registered the limited co in March 2019. I have received a response from a firm of solicitors who specialise in recovering monies in these circumstances, their charges are not unreasonable. I have been straight up with what has happened I just used the limited company account as a sole trader, filing my tax returns as such. There are also big tax impacts as well stemming from the rather sloppy approach you had to dealing with your limited company. All that money that went into the company bank account was an inadvertent statement that the company was actually trading - so the company should have been preparing accounts, submitting Corporation Tax returns and paying Corporation Tax on the profits. Also, any money extracted by your personally from the company bank account should have been declared as either director's salary or dividends.
How many years did this go on for?
The £100 restoration is only applicable if the company has been struck off. Restoring where there has been a dissolution as in my case as I thought I did not need the company means a court hearing. I think I am starting to understand what I need to do.
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