UK How do I file my 'Dormant' company accounts if my bank balance is not zero?

[bornfromanegg]

I am trying to file my company accounts for the first time. I set the company up about 19 months ago when I was looking for contracting work, but I then ended up taking a permanent job, and as a result, I have never traded with my company.

I am therefore attempting to file Dormant Company Accounts. But I have a problem.

I have a business bank account. This has charges (£6 per month) so I have put some money into the account in order to cover the charges. My balance is therefore not zero.

When I try to file there are four boxes I need to fill in which appear to be incompatible:

- Called up share capital not paid : £0
- Cash at bank and in hand : £94.12
- Net assets : £94.12
- Shareholder's fund : £1

If I fill this in it says

> Shareholder's fund must be equal to net assets

If I set Net assets to £1 it says

> 'Net assets' must be equal to the sum of 'Called up share capital not paid' and 'Cash at bank and in hand'

The only thing it will accept is if I enter £1 for 'Cash at bank and in hand' as well.

Given that my bank balance *is* £94.12 I can't do this, but then how do I complete the form? Or does the fact that I have had to pay bank charges mean that the company is not dormant? If this last is the case, then how do I file the accounts? Micro-entity?

 

[bklynboy]

I would set net assets to 0 or £1 since you have cash in the account but should also have a liability as a payable back to you. As I understand it the cash was never contributed to the company so the company owes this back to you.

 

[bornfromanegg]

I would set net assets to 0 or £1 since you have cash in the account but should also have a liability as a payable back to you.

If I set net assets to £1, then I *have* to set ‘Cash at bank and at hand’ to £1 as well, or I get the second error listed above. Is it not wrong for me to say £1 for this, given my balance is actually £94.12?

 

[Steve-LevelUp]

What bklynboy is referring to is the balance sheet not being in balance. You have 94 in assets, 0 liabilities an 1 in equity. So, the 94 is either a cash contribution (equity), an owners loan (liability) or retained earnings from prior year earnings (equity) without one of the above, the trial balance does not balance.

 

[bklynboy]

You may need a tax expert from England to advise but you may not be able to file as dormant if you have the extra cash in the account which is why you are getting an error. Dormant I think means there is no liability but check with a expert to be sure or read the rules carefully.

 

[Becky]

From a tax point of view it is possible to have a cash balance and qualify as dormant. Broadly speaking, as long as the company isn't trading or holding investments it should be fine.