Closing a limited company

To have your company struck off the register, you need to send Companies House form DS01. The form must be signed by a majority of the company's directors.

Further information on the responsibilities of closing down a company properly, when a company cannot apply to be struck off, withdrawing a strike off application and more can be found at HMRC's resource.

If you want to stop trading as a sole trader or you're ending or leaving a business partnership, you need to inform HMRC. You're also required to send a final tax return.

If you're closing down a limited company, how you close your company will depend on whether your company is profitable or if it has reached the point of insolvency.

If you're closing down a solvent company, you may apply to get your company struck off the Register of Companies or start a members' voluntary liquidation.

If you're closing an insolvent company, the company will have to be liquidated.

How you close down your limited company will differ depending on whether your company is solvent or insolvent.

1. Closing down a solvent company

You may apply to strike off your company from the Companies Register or start a Members' Voluntary Liquidation.

2. Closing down an insolvent company

You must arrange the liquidation of your company. In certain circumstances, you may be able to avoid liquidation by applying for a Company Voluntary Arrangement.

Further information is available on our resource on the company closure process.

A Members Voluntary Liquidation is the process of bringing a solvent company to a close. This option is available only if your company is solvent, and one of the following conditions apply:

• You want to retire
• You want to step down from the family business, and no one else wants to run the company
• You don't want to run the business anymore
  

To apply for this process, you need to:

• Make a ‚ÄòDeclaration of solvency' (for English and Welse companies)
• Request for form 4.25 (Scot) from the Accountant in Bankruptcy (Scottish companies)
  

After signing the declaration or form, there are a few additional steps you need to take before completing the process. This information is available on the HMRC website.

To have your company struck off the register, you need to send Companies House form DS01. The form must be signed by a majority of the company's directors.

Further information on the responsibilities of closing down a company properly, when a company cannot apply to be struck off, withdrawing a strike off application and more can be found at HMRC's resource.

How you close your limited company will depend on whether your company is profitable or if it has reached the point of insolvency.

If you're closing down a solvent company, you may apply to get your company struck off the Register of Companies or start a members' voluntary liquidation.

If you're closing an insolvent company, the company will have to be liquidated.

You can claim Entrepreneurs' Relief on your annual Self Assessment tax return, under the 'Capital Gains Summary' section.

It is also possible to claim the relief on the sale of other assets which are not shares. The rules on this are different and it is best to discuss your individual case with a qualified accountant.