Voluntary dissolution

Introduction
 The application
Notifying interested parties
Objections
Dissolution by Companies House and its effects
Offences and penalties

Introduction
A company may apply to the registrar to be struck off the register and dissolved if it is no longer needed. Dissolution is not an alternative to formal insolvency proceedings where these are appropriate, and in particular, not if the company is unable to pay its debts. Even if the company is struck off and dissolved, creditors and others could apply for the company to be restored to the register. Note that Companies House also has powers to strike companies off the register if they appear to be no longer needed because they have not registered annual returns or accounts.

The application
An application for voluntary striking off can only be made on the company’s behalf by its directors or a majority of them on form DS01 with the £10 registration fee.
CA 2006, sec1004 and sec1005 set out the circumstances in which the company may not apply to be struck off, in particular, it may not make an application for to be dissolved if, at any time in the last three months, it has:

A company cannot apply to be struck off if it is the subject, or proposed subject, of any insolvency proceedings such as liquidation, administration or a compromise or arrangement with creditors or members, but it may apply to be struck off if it has settled trading or business debts in the last three months.

The form must be signed by all the directors or, if there are three or more, a majority of them.

Notifying interested parties
The directors must within 7 days send a copy to the following:

Once the application is made Companies House will register the information and put it on the company's public record. The application will be advertised in the London, Edinburgh or Belfast Gazette (as appropriate). In theory, this is to allow interested parties the opportunity to object or complain.

Objections
Objections or complaints must be in writing and sent to Companies House with any supporting evidence. Reasons for objecting may include:

A full list of conditions can be found in sec1004 and sec1005.

Dissolution by Companies House and its effects
Unless there is a reason to delay (e.g. because of objections) Companies House will strike the company off the register not less than three months after the date of the notice in the Gazette. The company will be dissolved on publication of a further such notice. From the date of dissolution, any assets of a dissolved company will belong to the Crown as bona vacantia. The company’s bank account will be frozen and any credit balance in the account will pass to the Crown.

Offences and penalties
 It is an offence:

The offences attract a fine of up to £5,000 on before a magistrates' court or Sheriff Court or an unlimited fine on indictment. If the directors breach the requirements to give a copy of the application to relevant parties and do so with the intention of concealing the application, they are also potentially liable not only a fine but also up to seven years imprisonment. Anyone convicted of these offences may also be disqualified from being a director for up to 15 years.

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