Can You Restore A Dissolved Company? Our Guide
Company restoration after the directors or other parties dissolved it is certainly doable, but not always straightforward.
In this guide we’ll explore the reasons why former directors may want to restore a company, plus what the process involves.
At the time of writing, the number of company strike offs is increasing. According to the latest figures from Companies House, between July and September 2023, there were 161,761 company dissolutions in the UK. That’s a rise of 8.2% compared with the same period in 2022.
However, not all companies stay dissolved. It is possible to restore a company and there are a wide range of reasons why this can happen.
Dissolving / striking off a company
Dissolving or striking off a business means removing its entry from the official register at the government’s Companies House, so that it is no longer a legal entity. Here is the process for striking off a limited company.
You can dissolve your business with Companies House if it has:
- Not traded in the last three months
- Not received a liquidation threat
- Not changed its company name in the last three months
- No agreements with creditors such as a Company Voluntary Arrangement (CVA)
The business needs to be solvent and able to pay any debts before closing. Otherwise, a creditors’ voluntary liquidation (CVL) or in more extreme circumstances, a compulsory liquidation, are processes for closing insolvent companies.
Why dissolve a company? Well, there could be no further need for the business, or its directors may all want to retire, for example – previously we’ve covered what happens to directors of a dissolved company.
Lastly, it’s also possible for a company to go through a compulsory strike off process with more serious consequences. Companies House could apply for this if the business has failed to file annual accounts or statements, for example.
Any remaining assets still owned by the dissolved company go to the Crown via Bona Vacantia (vacant goods) – part of the government legal department. Notice of dissolution is published in The Gazette, at which point anyone opposing it has two months to object.
Reasons to restore a company
There are a range of reasons why directors may want to restore a previously dissolved company, whether it was a compulsory one or not.
The former directors may want to continue trading, or recover any assets that the dissolution process passed on via Bona Vacantia laws. These could include intellectual property, land, shares, mortgages or bank funds.
Alternatively, if it emerges that the dissolved company could make a business insurance claim for losses, that’s another potential reason to restore it.
However, there are reasons why creditors or other interested parties could also attempt to restore the company. To apply for this, they would need to enter into a court restoration process.
How to restore a dissolved company
There are two ways to restore a company that’s no longer on the Companies House register:
- Administrative restoration
- Court restoration
An administrative restoration is for former directors or shareholders within six years of a business dissolution initiated by Companies House if it was still trading at the time.
The process involves sending Companies House form RT01 and a cheque for £100. Any outstanding documents, such as accounts or confirmation statements, are also required – plus any filing fees or penalty payments and a waiver letter WA1 from Bona Vacantia.
However, the court restoration process for other circumstances, including after a voluntary company dissolution or for a creditor claim, is more complicated. Therefore, legal advice is recommended.
At the outset it involves sending form N208 to the nearest county court, a witness statement, a £280 court fee and costs for the Registrar of Companies – approximately £300. Expect the process to take about four months and involve further costs.
Final thoughts: Can you restore a dissolved company?
For shareholders looking to claim back some money, it’s also worth noting that if your application to restore a company is unsuccessful, you could still get a discretionary grant.
As an alternative to striking it off with Companies House, a solvent company can also close down via a Members’ Voluntary Liquidation (MVL).
Also, in our guide to DS01 forms, we explain the circumstances when filling this in is the correct option for closing a limited company.
For more information about restoring a dissolved company, we recommend speaking to an expert without delay.
We are a team of highly qualified chartered accountants and insolvency practitioners with many years of experience. Please don’t hesitate to contact us with any queries.
