What is company dissolution?

13th April 2026

When a company is removed from the Companies House register, this is known as company dissolution. This can be done voluntarily or involuntarily where a business is struck off the register for failing to meet Companies House filing deadlines. Once a company is dissolved, it no longer exists in a legal capacity and cannot continue trading.

If you are in the process of dissolving your limited company, you don’t have to navigate the process without guidance. 99p Company Formations have helped numerous companies across the UK successfully apply for dissolution so we know all the intricacies of the process. 

How to dissolve a limited company

To close a limited company, the company shareholders and directors must come to a mutual agreement. There are multiple options for dissolution but your choices will be limited depending on whether the company is considered ‘solvent’ or ‘insolvent’. 

If the company can pay its bills (solvent)

If the company can pay its bills then there are two options available for company dissolution. You can:

Apply for voluntary strike off:

The Companies House guidelines for voluntarily strike off outline state that you can only strike off your company if it:

• ‘has not traded or sold off any stock in the last 3 months

• has not changed names in the last 3 months

• is not threatened with liquidation

• has no agreements with creditors, for example a Company Voluntary Arrangement (CVA)’

Liquidate your limited company:

If your company does not meet the above criteria for voluntary strike off and the company is solvent, then you will need to liquidate your limited company.

The criteria for liquidation a business is simple: your company must be solvent, and:

• you want to retire

• you run a family business, want to step down, and there is no one suitable to run it or

• you don’t want to run the business any more

In order to liquidate a limited company, you will need to make a declaration of solvency that acts as a formal review of the company’s assets and liabilities including how long it will take to pay off any outstanding debts. This must be no longer than 12 months after the date of liquidation.

If the company cannot pay its bills (insolvent)

If your company is insolvent at the time of dissolution, the needs of investors and creditors will be prioritised over the wants of the director and shareholders. Depending on the circumstances of your company, you can:

Put your company into administration:

Administration is a formal insolvency process used when a company cannot pay its debts but may still be viable. By entering administration, the business is temporarily protected from legal action by creditors while an appointed insolvency practitioner takes control. 

The administrator assesses the best way forward, which could include restructuring the business, arranging a repayment plan, selling the company (or parts of it), or ultimately closing it down. Their primary goal is to achieve the best possible outcome for creditors while exploring options to keep the business operating where possible.

Apply to get your company struck off the Companies Register:

Striking off a company is a straightforward way to close a business that is no longer trading. To qualify, the company must:

• Have been inactive for at least three months

• Have no outstanding debts or creditor agreements

• and not be facing insolvency proceedings

Directors must formally apply using the correct form and ensure all affairs, such as closing bank accounts and settling obligations, are completed beforehand. If no objections are raised, the company is removed from the register and legally ceases to exist, with any remaining assets transferred to the Crown. 

Arrange creditors voluntary liquidation: 

A creditors’ voluntary liquidation (CVL) is used when a company is insolvent and unable to continue trading. Directors initiate the process, but it requires approval from at least 75% of shareholders. Once agreed, a licensed insolvency practitioner is appointed as liquidator to take control, sell company assets, and distribute the proceeds to creditors. 

The process ensures the business is closed in an orderly and legally compliant way, with creditors repaid as far as possible before the company is dissolved.

Who can apply to dissolve a limited company? 

Any business can apply for voluntary strike off, but the application must be made by a majority of the company’s directors. For example, if there are three directors, at least two must apply. If there are two directors, both must apply. 

Company dissolution criteria 

Before applying to dissolve a company, there are a number of conditions that must be met. These are in place to ensure that businesses are not closed in a way that avoids responsibility for debts, legal obligations, or outstanding matters.

To apply for voluntary strike off, your company must:

• Not have traded or sold any stock in the last three months

• Not have changed its name in the last three months

• Not be under threat of liquidation

• Not have any agreements with creditors, such as a Company Voluntary Arrangement (CVA)

• Have settled all outstanding liabilities, including debts, employee wages, and tax obligations

• Not be involved in any ongoing legal proceedings

What happens after you apply to dissolve a company?

Once an application for voluntary strike off has been submitted to Companies House, the process does not happen immediately.

Companies House will publish a notice in the Gazette, informing interested parties of the intention to dissolve the company. This provides an opportunity for anyone with an interest in the business, such as creditors, employees, or other stakeholders, to raise an objection.

If no objections are received, the company will typically be struck off the register after a period of around two months. At this point, the company is officially dissolved and ceases to exist as a legal entity.

Can a company dissolution be stopped?

Yes, a company dissolution can be suspended or stopped if an objection is raised during the notice period. 

If an objection is upheld, the dissolution process will be paused until the issue is resolved. In some cases, the application may be rejected entirely.

Common reasons for objections include:

• Outstanding debts owed to creditors

• Unresolved disputes or legal action

• Concerns that the company is attempting to avoid its responsibilities

What happens to company assets after dissolution?

One of the most important points to understand is what happens to any remaining assets once a company is dissolved.

If assets are still held in the company at the point of dissolution such as money in a business bank account, property, equipment, or intellectual property

These will usually pass to the Crown as “bona vacantia” (ownerless property).

For this reason, it is essential that all assets are distributed appropriately before applying for dissolution. Failing to do so can result in the permanent loss of those assets.

Can you restore a dissolved company?

In some cases, it is possible to restore a company after it has been dissolved. However, this process can be more complex and costly than maintaining compliance in the first place.

Restoration typically involves applying through the courts or administrative processes, depending on the circumstances. There are also strict time limits, so it is important to act quickly if restoration is required.

A company may be restored if:

• It was struck off in error

• There is a need to recover assets

• Legal action needs to be taken involving the company

What happens to your company name after dissolution?

Once a company has been dissolved, its name becomes available for use again.

This means that:

• Another business can register the same name

• You may not be able to reclaim it if you decide to start again

If your company name has value, for branding or future plans, it may be worth considering keeping the company dormant instead of dissolving it.

Director responsibilities during dissolution

Even during the dissolution process, directors remain responsible for ensuring that everything is handled correctly.

This includes:

• Informing all relevant parties (e.g. creditors, employees, shareholders)

• Closing company bank accounts

• Settling outstanding debts and liabilities

• Submitting accurate information to Companies House

How 99p Company Formations can help

Closing a company may seem straightforward, but there are multiple steps involved and strict criteria that must be met. Missing a detail or misunderstanding the process can lead to delays or complications.

99p Company Formations can support businesses throughout the process of company dissolution, helping to ensure that applications are completed accurately and in line with Companies House requirements. Whether you are applying for voluntary strike off or simply exploring your options, having the right guidance can reduce the risk of issues arising and take the responsibility off your mind.